Chapter 2 to Puppy Co. Puppy Co. reported the following contribution margin income statement for 2020. Puppy Co. Contribution Income Statement For Year Ended December 31, 2020 Sales (9,600 units at $225 each) Variable costs (9,600 units at $180 each) Contribution margin Fixed costs Net operating income $2,160,000 1.728.000 432,000 324,000 $108.000 1) Compute the company's CM ratio and variable expense ratio. 2) Compute the company's break-even point in both units and sales dollars. 3) Assume Puppy Co. has a target net operating income of $162,000 for 2021. What amount of sales (in dollars) is needed to reach this target? 4) If Puppy Co. achieves its target net operating income for 2021, what is its margin of safety in percentage form? 5) Assume the company is considering investing in a new machine that will increase its fixed costs by $40,500 per year and decrease its variable costs by $9 per unit. Assuming the company purchases this machine, what would be the impact on net operating income? 6) Compute the company's degree of operating leverage for 2020. 7) Assume sales decrease by 5% in 2020, what is the company's net operating income (use the degree of operating leverage to compute)