Smith Company sells flags with team logos. Smith has fixed costs of $672,000 per year plus variable costs of $8.40 per flag. Each flag sells for $14.00. Read the requirements. First, select the formula to compute the required sales in units to break even. Net sales revenue per unit Fixed costs Variable costs Target profit Rearrange the formula you determined above and compute the required number of flags to break even. The number of flags Smith must sell each year to break even is Requirement 2. Use the contribution margin ratio approach to compute the dollar sales Smith needs to earn $22,400 in operating income for the year. (Round the contribution margin ratio to two decimal places.) = Begin by showing the formula and then entering the amounts to calculate the required sales dollars to earn $22,400 in operating income. (Round the required sales in dollars up to the nearest whole dollar. For example, $10.25 would be rounded to $11. Abbreviation used: CM contribution margin.) = Required sales in dollars %