Danas Ribbon World makes award rosettes. Following is information about the company:

Variable cost per rosette$ 2.00Sales price per rosette4.00Total fixed costs per month3000.00

Required:

1. Suppose Danas would like to generate a profit of $960. Determine how many rosettes it must sell to achieve this target profit.
2. If Danas sells 1,900 rosettes, compute its margin of safety in units, in sales dollars, and as a percentage of sales.
3. Calculate Danas degree of operating leverage if it sells 1,900 rosettes.
4. 1. Using the degree of operating leverage, calculate the percentage change in Danas profit if unit sales drop to 1,520 units.
   2. Prepare a new contribution margin income statement to verify change in Dana's profit.