Problem 11-29 Margin of safety and operating leverage Lo Rooney Company is considering the addition of a new product to is a skin cream, a bath oil, or a hair coloring gel. Relevant information and budgeted annual income statements for each of the follow 11-6 cosmetics line. The company has three distinctly difeent Expected sales price (b) Variable costs per unit (c) Sales revenue (a x b) variable costs (a x c) Contribution margin Fixed costS 693,000 5//300,000 Required a. Determine the margin of safety as a percentage for each product b. Prepare revised income statements for each product/ essuminga 2 c. For each product, determine the percentage change itn net income that d. Assuming that management is pessimistic and risk averse. which product should the compeny add to ts oNext