Sandhill Seats manufactures swivel seats for customized vans. It currently manufactures $9,400$ seats per year, which it sells for $$500$

per seat. It incurs variable costs of $$250$ per seat and fixed costs of $$2,115,000.$ It is considering automating the upholstery process,

which is now largely manual. It estimates that if it does so$,$ its fixed costs will be $$3,199,760,$ and its variable costs will decline to $$130$

per seat.

Answer the following questions.

Compute the contribution margin ratio, break$-$even point in sales dollars, margin of safety ratio, and degree of operating leverage

assuming the new upholstery system is implemented. $($Round degree of operating leverage to $1$ decimal place, e$.$g$.2\mathrm{.}5.)$

Contribution margin ratio

Break$-$even point in dollars