The following income statement was drawn from the records of Perez Company, a merchandising firm: PEREZ COMPANY Income Statement For the Year Ended December 31, 2018 Sales revenue (4,500 units x $168) $ 756,000 Cost of goods sold (4,500 units * $82) (369,000) Gross margin 387,000 Sales commissions (10% of sales) (75,600) Administrative salaries expense (86,000) Advertising expense (30,000) Depreciation expense (44,000) Shipping and handling expenses (4,500 units (13,500) x $3) Net income $ 137,900 Required a. Reconstruct the income statement using the contribution margin format. b. Calculate the magnitude of operating leverage. c. Use the measure of operating leverage to determine the amount of net income Perez will earn if sales increase by 10 percent. Required A Req B and C Reconstruct the income statement using the contribution margin format. PEREZ COMPANY Income Statement For the Year Ended December 31, 2018 Less: Variable costs 0 Less: Fixed costs $ 0 Calculate the magnitude of operating leverage. Use the measure of operating leverage to deterr Perez will earn if sales increase by 10 percent. (Round intermediate and "Operating leverage" a times b. Operating leverage Net income C.