Exercise 3.35 The following budget data apply to Metlock's Nutrition: $1,000,000 Sales (100,000 units) Costs Direct materials Direct labour Fixed factory overhead Variable factory overhead Marketing and administration Total costs Budgeted pretax income $270,000 230,000 100,000 160,000 150,000 $910,000 $90,000 Direct labour workers are paid hourly wages and go home when there is no work. The marketing and administration costs include $40,000 that varies proportionately with production volume. Assume that sales and production volumes are equal. Compute the number of units that must be sold to achieve a target after-tax income of $126,000, assuming a tax rate of 40%. (Round answer to whole amounts, e.g. 5,275.) Units at target level units Calculate the margin of safety in both revenues and units. (Round answers to 0 decimal places, e.g. 125.) or Margin of safety $ units Calculate the degree of operating leverage. (Round to 2 decimal places, e.g. 15.25.)