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Requirement $1.$ Compute the monthly margin of safety in dollars if the shop achieves its income goal.

Begin by identifying the formula to compute the margin of safety.

$=$ Margin of safety in dollars

Requirements

Compute the monthly margin of safety in dollars if the shop achieves its income goal.

Express Carter's margin of safety as a percentage of target sales.

What is Carter's operating leverage factor at the target level of operating income?

Assume that the company reaches its target. By what percentage will the company's operating income fall if sales volume declines by $12\%?$

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