Contribution margin, break-even sales, cost-volume-profit chart, margin of safety, and operating leverage It is expected that 21,875 units will be sold at a price of $160 a unit. Maximum sales within the relevant range are 27,000 units. Required: 1. Prepare an estimated income statement for 20Y3. Wolsey Industries Inc. Estimated Income Statement For the Year Ended December 31, 20Y3 Line Item Description Cost of goods sold: Direct materials Direct labor Gross profit Expenses: Selling expenses: Total selling expenses Administrative expenses: Office and officers' salaries Supplies Amount Amount Amount Miscellaneous administrative expense 2 Total administrative expenses T Check My Work 1. Use the data to compute the total costs. Remember that some of the costs have a fixed and a variable cost component. 2. What is the expected contribution margin ratio? % 3. Determine the break-even sales in units and dollars. Units units Dollars 4. Construct a cost-volume-profit chart on your own paper. What is the break-even sales? 2 5. What is the expected margin of safety in dollars and as a percentage of sales? Dollars Percentage % 6. Determine the operating leverage. If required, round your answer to one decimal place, e.g. 15.4