Croftsman Company recorded the following information for its main product:

Selling price per unit...................................................................$200
Costs per unit (at the normal capacity of 20,000 units):
Direct material.................................................................................50
Direct labour....................................................................................30
Variable overhead...........................................................................25
Fixed overhead................................................................................50
Sales commission............................................................................7.5% of sales

Required:

1. Compute the contribution margin ratio and break-even sales.

2. What is the margin of safety in dollars and units, and the degree of operating leverage?