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Problem 5-20 Various CVP Questions: Break-Even Point: Cost Structure; Target Sales CLO5-1, LO5-3, LO5-4, LO5-5, LO5-6, LO5-8] Northwood Company manufactures basketballs. The company has a ball that sells for $49. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $34.30 per ba of which 70% is direct labor cost Last year, the company sold 58,000 of these balls, with the following results: $2,842,000 Sales (58,000 balls) 1,989,400 Variable expenses 852,600 Contribution margin 705,600 Fixed expenses S 147,000 Net operating income Required: 1-a. Compute the CM ratio and the break-even point in balls. (Do not round intermediate calculations.) CM Ratio balls Unit sales to break even 1-b. Compute the the degree of operating leverage at last year's sales level. (Round your answer to 2 decimal places.) Degree of operating