Belmain Co. expects to maintain the same inventories at the end of 2016 as at the beginning of the year. The total of all production costs for the year is therefore assumed to be equal to the cost of goods sold. With this in mind, the various department heads were asked to submit estimates of the costs for their departments during the year. A summary report of these estimates is as follows: Estimated Fxed Cost Estimated Variable Cost unit sold) Production costs: $$0.00 30.00 6.00 Direct materials.... Factory overhead 350.000 Selling expenses: 4.00 340,000 116,000 4,000 Travel 1.00 Office and officers salaries.. 325,000 6,000 1.00 Total 51.152000 $96.00 It is expected that 12,000 units will be sold at a price of S240 a unit. Maximum sales within the relevant range are 18,000 units. Instructions 1. Prepare an estimated income statement for 2016 2. What is the expected contribution margin ratio? 3. Determine the break-even sales in units and dollars. Answer Check Figure: 8,000 units 4. Construct a cost-volume-profit chart indicating the break 5. What is the expected margin of safety in dollars and as a 6. Determine the operating leverage even sales. percentage of sales