Wolsey Industries Inc. expects to maintain the same inventories at the end of 2016 as at the beginning of the year. The total of all production costs for the year is therefore assumed to be equal to the cost of goods sold. With this in mind, the various department heads were asked to submit estimates is as follows:

Estimated Variable Cost Estimated (per unit sold) Fixed Cost Production costs: Direct materials S 46 Direct labor Factory overhead $200,000 Selling expenses: Sales salaries and commissions. 110,000 Advertising 40,000 12,000 Travel 7,600 Miscellaneous selling expense Administrative expenses: 132,000 Office and officers' salaries 10,000 Supplies 13,400 Miscellaneous administrative expense $525,000 Total sales It is expected that 21,875 units will be sold at a price of $160 a unit. Maximum within the relevant range are 27,000 units. Instructions statement for 2016 1. Prepare an estimated income 2. What is the expected contribution margin ratio? 3. Determine the break-even sales in units and dollars. sales. sales? A. Construct a cost-volume-profit chart indicating the break-even of 5. What is the expected margin of safety in dollars and as a percentage 6. Determine the operating leverage