Contribution Margin, Break Even Sales, Cost-Volume-Profit Chart, Margin of Safety, and Operating Leverage Belmain co. expects to maintain the same inventories at the end of 2017 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 Estimated Variable Cost Fixed cost (per unit sold) Production costs: Direct materials $13 9 Direct labor 6 | | Factory overhead $118.000 Selling expenses: Sales salaries and commissions 24,500 3 Advertising 8,300 Travel 1,800 Miscellaneous selling expense 2.000 Administrative expenses: Office and officers' salaries 24,000 Supplies 2.900 Miscellaneous administrative expense 2,820 Total $184,320 $36 It is expected that 8,320 units will be sold at a price of $72 a unit. Maximum sales within the relevant range are 10,000 units. 1 1 Required: Nes 1. Prepare an estimated Income statement for 2017 Belmain Co. Estimated Income Statement For the Year Ended December 31, 2017 Cost of goods sold: Total cost of goods sold OD Gross profit Expenses: Selling expenses: o Total selling expenses Administrative expenses: n Total administrative expenses Total selling expenses Administrative expenses: Total administrative expenses o Total expenses Operating income 2. What is the expected contribution margin ratio? Round to the nearest whole percent