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How do you solve for the margin of safety, degree of operating leverage, and expected % change in operating income. What are the answers? A

How do you solve for the margin of safety, degree of operating leverage, and expected % change in operating income. What are the answers?

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A B C D Target prom per TOTIE E 6,UQU G H K Multiproduct Breakeven point: Total Units Product #1 Product #2 Jake's Pet Supplies in units 150 90 60 Sales revenue at breakeven Pro Forma Contribution Margin Income Statement 2,700 900 1,800 For the month ending June 30 Multiproduct Target profit point: Total Units Product #1 Product #2 Product #1 Product #2 Total in units 950 570 380 Sales Revenue S 2,400 S 4,800 $ 7,200 Sales revenue at target profit $ 17,100 5,700 S 11,400 Less: Variable Costs 960 2,240 $ 3,200 Contribution Margin S 1,440 S 2,560 $ 4,000 Less: Fixed Costs S 1,500 $ 1,500 $ 3,000 Operating Income S (60) $ 1,060 $ 1,000 9 Margin of Safety (in $) Margin of Safety % 33 Degree of Operating Leverage 34 Expected % change in operating 35 income (%) 36 + 37 38

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