for question 3 the comments should Also compare the net income as % of sales.

The owner of Candy's Buffet is preparing next year's budget. She wants to prepare a flexible budget for three different annual sales revenue levels using a contribution margin income statement. Three levels of sales revenue are to be used: $800,000,$900,000,$1,000,000. The following information is available to help prepare the flexible budget. Food cost averages 38% and variable costs averages 28% of sales revenue. Fixed labour cost is $52,000 annually, and other fixed costs are $120,000. Other variable costs average 10% of sales revenue. Income tax rate is estimated to be 29% on operating income (before tax). 2. Using the given information, prepare Candy's flexible three-level budget using the contribution margin method. 3. Calculate the breakeven sales. Comment on the results of each budget level with reference to the effect of higher sales revenue on net income (after tax)