eBook Calculator Margin of Safety and Operating Leverage Medina Company produces a single product. The projected income statement for the coming year is as follows: Sales (60,000 units @ $21.00) $1,260,000 Total variable cost 478,800 Contribution margin $ 781,200 Total fixed cost 755,160 Operating income $ 26,040 Required: 1. Compute the break-even sales dollars. 2. Compute the margin of safety in sales dollars 3. Compute the degree of operating leverage! 4. Compute the new operating income if sales are 20% higher than expected