Dog Dandy distributes a dog collar made of wooden beads that sells for $40 per unit. Variable expenses are $20 per unit, and feed expenses total $160,800 per year. Its operating results for last year were as follows: Sales Variable expenses Contribution margin Fixed expenses Operating income $536,000 268,000 268,000 160,800 $107,200 Required: Answer each of the following independent questions based on the original data. 1. What is the product's CM ratio? CM ratio % 2. Use the CM ratio to determine the break-even point in dollar sales Break even point in dollar sales 2. Use the CM ratio to determine the break-even point in dollar sales Break-even point in dollar sales 3. Assume this year's unit sales and total sales decrease by $53,400. If the fixed expenses do not change, how much will operati income decrease? Decrease in operating income 1 4. What is the degree of operating leverage based on last year's sales? (Round your answer to 1 decimal place.) Degree of operating leverage 5. Assume the this year's unit sales will decrease by 20% next year. Using the degree of operating leverage from last year, what percentage decrease in operating income will the company incur this year? Decrease in operating come 6-o. The sales manager is convinced that a 10% reduction in the selling price, combined with a $23,400 increase in advertising, would Increase this year's unit sales by 40%. If the sales manager is right, what would be this year's operating income of his ideas are implemented? Operating income 6-b. Do you recommend implementing the sales manager's suggestions? Yes O No