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 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 Fixed Cost Estimated Variable Cost (per unit sold) Production costs: Direct materials Direct labor Factory overhead $1,437,700 Selling expenses: Sales salaries and commissions Advertising Travel 298,800 101,100 22,500 Miscellaneous selling expense 24,700 Administrative expenses: Office and officers' salaries Supplies Miscellaneous administrative expense 292,000 35,900 33,700 Total $2,246,400 It is expected that 11,700 units will be sold at a price of $360 a unit. Maximum sales within the relevant range are 15,000 units Required: 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 Gross profit Expenses: Selling expenses: Total selling expenses Administrative expenses: Total administrative expenses Total expenses Total administrative expenses Total expenses Income from operations 2. What is the expected contribution margin ratio? Round to the nearest whole percent. % 3. Determine the break-even sales in units and dollars. Units units Dollars units 4. Construct a cost-volume-profit chart on your own paper. What is the break-even sales? 5. What is the expected margin of safety in dollars and as a percentage of sales? Dollars: Percentage: (Round to the nearest whole percent.) 6. Determine the operating leverage. Round to one decimal place