Feather Friends, Inc., distributes a high quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and foed expenses total $200,000 per year. Its operating results for last year were as follows: Sales Var Lable expenses Contribution margin xed expenses Het operating income $ 2,000,000 1,040,00 1,010,000 200,000 $ 840,000 Required: Answer each question independently based on the original data 1 What is the product's CM ratio? 2. Use the CM ratio to determine the break even point in dollar sales 3. Assume this year's unit sales and total sales increase by 40,000 units and $3,200,000, respectively. If the fred expenses do not change, how much wil net operating income increase? 4- What is the degree of operating leverage based on last year's sales 45 Assume the president expects this year's unit sales to increase by 18%. Using the degree of operating leverage from last year what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 14% reduction in the sang price.combined with a $76,000 increase in advertising, would increase this year's unit sales by 25% all the sales manager is right, what would be this year's net operating income this ideas are implemented? b. the sales manager's ideas are mplemented, how much wil net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $190 per unit He thinks that this move combined with some increase in advertising, would increase this year's unit sales by 25% How much could the president increase this year's advertising expense and learn the same $840.000 net operating income as last year Complete this question by entering your answers in the tabs below 2 3 Re R4 SA What is the product's ratio