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: Production costs: Direct materials Direct labor Factory overhead Selling expenses: Estimated Fixed Cost Estimated Variable Cost (per unit sold) $24 16 $709,600 12 Advertising Sales salaries and commissions 147,500 49,900 Travel 11,100 Miscellaneous selling expense 12,200 5114 Administrative expenses: Office and officers' salaries i Supplies Miscellaneous administrative expense Total 144,100 17,700 2 16,700 $1,108,800 $66 It is expected that 9,600 units will be sold at a price of $264 a unit. Maximum sales within the relevant range are 12,000 units. Required: statement.for.20YZ Total $1,108,800 $66 It is expected that 9,600 units will be sold at a price of $264 a unit. Maximum sales within the relevant range are 12,000 units. Required: 1. Prepare an estimated income statement for 2017. Sales Cost of goods sold: Direct materials Direct labor Factory overhead Belmain Co. Estimated Income Statement For the Year Ended December 31, 2017 Total cost of goods sold Gross profit Expenses: Selling expenses: Sales salaries and commissions Advertising Travel Miscellaneous selling expense Total selling expenses Administrative expenses: Office and officers' salaries Supplies DO 000 00 Total selling expenses Administrative expenses: Office and officers' salaries Supplies Miscellaneous administrative expense Total administrative expenses Total expenses Operating income Feedback 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 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. %