trying to find answers for 5-7

Sales (40,000 Units @ $50 per unit) $2,000,000 Variable Expenses ($30 per unit) 1,200,000 Fixed Expenses 500,000 REQUIRED: 1. Compute the company's CM ratio and variable expense ratio, 2 Compute the company's break even point in both unit sales and dollar sales. 3. Assume that next year managemen wants company to earn a profit of at least $540,000. How many units will have to be sold to meet this target profit? 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage form. 5. Compute the company's degree of operating leverage at the present level of sales. 6. Assume that through a more intense effort by the sales staff, the company's sales increase by 8% next year. By what percentage would you expect net operating income to increase? Use the degree of operating leverage to obtain your answer. 7. In an effort to increase sales and profits, management is considering the use of a higher quality earbud. The higher quality earbud would increase variable costs by $5 per unit, but management could eliminate one worker who is paid a salary of $60,000 per year. The sales manager estimates that the higher quality earbud would increase annual sales by at least 15% a. Assuming that changes are made as described above, compute the company's new break-even point in both unit sales