Income Statements for Three Companies Are Provided Below Required:
(A)Prepare New Income Statements for the Firms Assuming Each

Essay

Income statements for three companies are provided below:
$\begin{array}{lccc}& \text { Company A } & \text { Company B } & \text { Company C } \\\text {Sales (20 units)}& \$ 1,000& \$ 1,000& \$ 1,000\\\text {Less variable costs}& 600 & 300 &- \\\text {Less fixed costs}& 200 & 500 & 800 \\ \text {Net income}&\$200 & 200 & \$200 \\\end{array}$ Required:
(a)Prepare new income statements for the firms assuming each sells one additional unit (i.e.each firm sells 21 units)
(b)Briefly describe the effect of cost structure on profitability.