In March, James Electronics had sales of $2,500,000 (25,000 units), total variable expenses of $1,500,000, and total fixed expenses of $800,000.

1. What is the companys CM ratio?

2. Using the CM ratio, calculate the break-even level of sales in dollars.

3. What is the break-even level of sales in units?

4. Estimate the change in the companys operating income if it increased its total sales by $600,000.