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Cove s Cakes is a local bakery. Price and cost information follows: Price per cake $ 1 7 . 0 0 Variable cost per cake

Coves Cakes is a local bakery. Price and cost information follows:
Price per cake $ 17.00
Variable cost per cake
Ingredients 2.50
Direct labor 1.40
Overhead (box, etc.)0.20
Fixed cost per month $ 3,850.00
Required:
1. Calculate Coves new break-even point under each of the following independent scenarios: (Round your answer to the nearest whole number.)
a. Sales price increases by $1.00 per cake.
b. Fixed costs increase by $500 per month.
c. Variable costs decrease by $0.35 per cake.
d. Sales price decreases by $0.50 per cake.
2. Assume that Cove sold 400 cakes last month. Calculate the companys degree of operating leverage. (Round your answer to 4 decimal places.)
3. Using the degree of operating leverage, calculate the change in profit caused by a 10 percent increase in sales revenue. (Do not round your intermediate calculations. Round your final answer to 2 decimal places. (i.e..1234 should be entered as 12.34%.))

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