Question no. 2 Thus, the company manufactures basketball selling for $25 company the company's variable expenses are hiph twing for $25 per ball in a small plant heavily relying on direct laboe 5 per ball of which 60% is direct Last yeaty th costhy,0.000 3.400 .000 2.30 .000 90.000 of operating levt year's contribution margin (CM) ratio and break-even point (BEP) in units and (b) the degree a) CmRation=sellingprice100CMperunit units and (b) the degree 2520010 =40% selling price =$25 variable cost per unit =15 contribution margin per unit =10 Next page 2. Due to an increase in labor rate, the company estimates next year's variable expenses will increase by $3 per ball. If this change takes place and the selling price per ball remains constant at $25, what will be the CM ratio and BEP in units next year? Cm ratio =sellingpricex200cmperunit=251007 selling price =$25 varciable cost per unit =18 =28% Next contribution morgin perunit =7 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income of $90,000 as last year? To gain the same net opercting income