Contribution margin, break-even sales, cost-volume-profit chart, margin of safety, and operating leverage. Organic Health Care Products Inc, expects to maintain the same inventories at the end of 2008 as at the beginning of the years. 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 is as follows: It is expected that 400,000 units will be sold at a price of $25 a unit. Maximum sales within the relevant range are 500,000 units. Instructions Prepare an estimated income statement for 20Y8 What is the expected contribution margin ratio? Determine the break-even sales in units What is the expected margin of safety in dollars and as a percentage of sales? Determine the operating leverage