Imagen Arquitectnica of Tijuana, Mexico, is contemplating a major change in its cost structure. Currently, all of its drafting work is performed by skilled draftspersons. Alfredo Ayala, Imagen's owner, is considering replacing the draftspersons with a computerized drafting system. However, before making the change, Alfredo would like to know its consequences, since the volume of business varies significantly from year to year. Shown below are CVP income statements for each alternative: Manual System Computerized System Sales $ 1,487,500 $ 1,487,500 Variable costs 1,190,000 892,500 Contribution margin 297,500 595,000 Fixed costs 178,500 476,000 Operating income $ 119,000 $ 119,000 Determine the degree of operating leverage for each alternative. (Round answer to 2 decimal places, e.g. 15.25.) Operating leverage Manual System Computerized System Calculate which alternative would produce the higher operating income if sales increased by $ 119,000. would produce a higher operating income. Using the margin of safety ratio, determine which alternative could sustain the greater decline in sales before operating at a loss. (Round margin of safety ratio to 2 decimal places, e.g. 15.25%.) Margin of Safety Ratio Manual % Computerized % could sustain the greater decline in sales before operating at a loss