(Please break this down to help me on this homework)

Zing Company reports the following information:

10,000 units Per Unit

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Sales $ 220,000 $22.00

Less: Variable Costs (85,000) (8.50)

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Contribution Margin $ 135,000 $13.50

Less: Fixed Costs (45,000) (4.50)

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Net Income $ 90,000 $(9.00)

1. Calculate the firm's breakeven point in units (round to nearest unit).

2. Calculate the firm's operating leverage.

3. If the variable costs change from $8.50 per unit to $8.00 per unit and the fixed costs change from $45,000 to $50,000, what is the new breakeven point in units (round to nearest unit)?

4. Return to the original information. The firm is considering increasing it's advertising (a fixed cost) by $30,000 and believes that will increase sales by 20%. Should the firm increase its advertising? Put "YES" or "NO" in the answer box, but you must show computations to support this answer.