Question 2: Pringle Company distributes a single product, the company's sale and expenses for a recent month follow: Total Per Unite Sales 225,000 75 Variable expenses...... 135.000 45 Contribution margin... 90,000 Fixed Expenses ... 75.000 Net Operating Income 15.000 30 The company is selling 3,000 units per month. Required: 1. What is the monthly break-even point in units and in sales dollars? 2. How many units would have to be sold each month to earn a target profit of 27,000? 3. Refer to the original data; compute the company's margin of safety in dollars. 4. What is the company's CM ratio, if the monthly sales increase by $ 120,000 and there is no change in fixed expenses, by how much would you expect monthly net operating income increase? 5. Refer to the original data; management is considering using higher-quality components that would increase the variable cost by $2 per unit. The marketing manager believes that the higher quality product would increase sales by 10%. Should the higher-quality components should be used? 6. What is the margin of safety in percentage? 7. What is a degree of operation leverage? 8. Estimate the impact on net operating income of a 6% increase in sales