Dana's Ribbon World makes award rosettes. Following is information about the company: Variable cost per rosette Sales price per rosette Total fixed costs per month $ 1.60 4.00 1200.00 Required: 1. Suppose Dana's would like to generate a profit of $920. Determine how many rosettes it must sell to achieve this target profit. 2. If Dana's sells 870 rosettes, compute its margin of safety in units, in sales dollars, and as a percentage of sales. 3. Calculate Dana's degree of operating leverage if it sells 870 rosettes. 4. a. Using the degree of operating leverage, calculate the percentage change in Dana's profit if unit sales drop to 696 units. b. Prepare a new contribution margin income statement to verify change in Dana's profit.

Dana's Ribbon World makes award rosettes. Following is information about the company: Required: 1. Suppose Dana's would like to generate a profit of $920. Determine how many rosettes it must sell to achieve this target profit. 2. If Dana's sells 870 rosettes, compute its margin of safety in units, in saies dollars, and as a percentage of sales 3. Calculate Dana's degree of operating leverage if it sells 870 rosettes. 4. 0 . Using the degree of operating leverage, calculate the percentage change in Dana's profit if unit sales drop to 696 units. b. Prepare a new contribution margin income statement to verify change in Dana's profit