Rayhall Company currently manufactures and sells two styles of upholstered chairs, upright (stationary) chairs and recliner rockers. The VP of Marketing projects the following volume and selling price, and the production manager estimates the variable cost per unit of each product for next year: Upright Recliner Units 3,500 1,500 Selling price per unit $280 $450 Variable cost per unit $160 $240 Total fixed costs are projected to be $545,000. The tax rate is 35%. Desired after-tax net income is $140,000. REQUIRED: a. Prepare an analysis showing the following, assuming the sales mix remains constant: (1) Prepare a condensed income statement in the contribution margin format for the projected sales volume. The statement should show the contribution margin for each product and total after-tax net income (similar to the income statement in part 2 of the P3-32 Excel solution, with lines added in the total column for income tax and after-tax net income). (2) Assuming a constant sales mix, calculate the break-even point in total units and total sales dollars, then apply the sales mix percentages to find the breakdown by product. (3) Calculate the following for total sales (not by product): a. margin of safety in dollars, b. the margin of safety ratio and c. degree of operating leverage (4) The vice president of marketing wants to know how many units would need to be sold to earn the desired after-tax net income. Assuming a constant sales mix, a. compute the units (in total and then broken down by-product), and b. prepare a condensed income statement showing the results. b. (1) The president, Tom Rayhall, believes the VP of marketing has overestimated sales of recliners, which he thinks will have a weaker demand this year. He asks you to repeat all of your analyses in part (a)(1-4) using the following projected sales: Upright Recliner Units 3,700 1,300 Selling prices, variable costs per unit, and total fixed costs remained the same. (You should be able to use the spreadsheet you developed for part (a) and only need to change the numbers in your data section following instruction 2 above.) (2) How does the shift in sales mix affect net income, the breakeven point, and margin of safety?