Variable cost per rosette	$	2.50
Sales price per rosette		6.00
Total fixed costs per month		7000.00

Required:

1. Suppose Danas would like to generate a profit of $1,140. Determine how many rosettes it must sell to achieve this target profit.

2. If Danas sells 2,160 rosettes, compute its margin of safety in units, in sales dollars, and as a percentage of sales.

3. Calculate Danas degree of operating leverage if it sells 2,160 rosettes.

4a. Using the degree of operating leverage, calculate the change in Danas profit if unit sales drop to 1,836 units.

4b. Prepare a new contribution margin income statement to verify change in dana's profit.