Hudson Co. reports the contribution margin income statement for 2017.

HUDSON CO.
Contribution Margin Income Statement
For Year Ended December 31, 2017
Sales (9,000 units at $280 each)	$	2,520,000
Variable costs (9,000 units at $210 each)		1,890,000
Contribution margin	$	630,000
Fixed costs		420,000
Pretax income	$	210,000

1. Compute the companys degree of operating leverage for 2017. 2. If sales decrease by 6% in 2018, what will be the companys pretax income? 3. Assume sales for 2018 decrease by 6%. Prepare a contribution margin income statement for 2018.