Using the margin of safety ratio, determine which alternative could sustain the greater decline in sales before operating at a loss.

Using the margin of safety ratio, determine which alternative could sustain the greater decline in sales before operating at a loss. Cullumber Modernas of Juarez, Mexico, is contemplating a major change in its cost structure. Currently, all of its drafting work is performed by skilled draftemen Rafaet ylmincz, Cullumber's owner, Is constdering reptacing the draftsmen witha computerized drafting system. However, before making the change. Rafael would like to know the consequences of the change, since the volume of business varies significantly from year to year. Shown below are CVP income statements for each alternative. (a) Youransweriscorrect. Determine the degree of operating leverage for each alternative, (Round aniwen to 2 decimal places, es. 1.25) Your insweiscorrect. Calculate the increase in Net income for each alternative if sales increased by 5125 , 000 due to an increane in the number of units soid Which alternative would produce the hicher net incamb