Margin of Safety and Operating Leverage Medina Company produces a single product. The projected income statement for the coming year is as follows: Sales (58,000 units @ $27.00) Total variable cost Contribution margin Total fixed cost Operating income Required: 1. Compute the break-even sales dollars. 2. Compute the margin of safety in sales dollars. $1,566,000 908,280 $ 657,720 635,040 $ 22,680 3. Compute the degree of operating leverage. 4. Compute the new operating income if sales are 20% higher than expected