Hudson Company reports the following contribution margin income statement. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales (9,500 units at $225 each) Variable costs (9,500 units at $180 each) Contribution margin Fixed costs Income 1. Compute the company's degree of operating leverage. $ 2,137,500 1,710,000 $ 427,500 342,000 $ 85,500 2. If sales decrease by 4% in the next year, what will be the company's income? 3. Prepare a contribution margin income statement for the next year assuming sales decrease by 4%. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the company's degree of operating leverage. Note: Round your answer to 1 decimal place. Degree of operating leverage Required 1 Required 2 Required 3 If sales decrease by 4% in the next year, what will be the company's income? Income Required 1 Required 2 Required 3 Prepare a contribution margin income statement for the next year assuming sales decrease by 4%. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales Variable costs Contribution margin Fixed costs Income