2 2.5$ TRUE or FALSE? A company's degree of operating leverage is smallest at the company's dreak-even point and increases as sales volume increases. O True False 5 2.5$ Han Inc. earned $300,000 of sales revenue last year when it sold 30,000 units of its single product. The company's contribution margin ratio was 40% and fixed costs were $100,000. The company's marketing department has proposed a $0.50 per unit sales price decrease for the coming year. If the variable cost per unit and fixed costs remain the same as last year's, then how many units will Han Inc. need to sell in the coming year at the lower selling price to earn the same operating income as last year? (Round your final answer to the nearest whole unit.) O 5,715 units O 36,000 units 0 34.286 units 0 28.572 units O None of the above 6 2.5$ Hummel Corporation's margin of safety equals 20% of its actual sales. The company's break-even point in sales revenue is $500,000 and its contribution margin ratio is 40%. Given this information, Hummel's operating income is: $65,000 O $55,000 O $50,000 O $41,500 O None of the above 10 2.5 Kringle Company makes a deluxe Christmas ornament box, which includes 24 ornaments per box. One box normally sells for $20.A large retail customer offered to purchase 6.000 deluxe ornament boxes if the company agrees to a 25% discount on its normal selling price. Costs per deluxe ornament box are as follows: Direct $6 materials Direct labor $2 Variable $2 overhead Fixed Overhead $3 Sales commissions on the special order would be 10% of the discounted selling price. The company is currently operating below capacity and has enough capacity to fill the special order without interfering with regular sales. Should Kringle accept the special order and why? Yes, it leads to a $21,000 financial advantage Yes, it leads to a $30,000 financial advantage No, it leads to a financial disadvantage of $19.000 No, it leads to a financial disadvantage of $43,000 O None of the above