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

Essay

Income statements for three companies are provided below:
$\begin{array}{|l|c|c|c|}\hline& \text { Company A } & \text { Company B } & \text { Company C }\\\hline \text { Sales (20 units) } & \$ 1,000 & \$1,000 & \$1,000 \\\hline \text { Less variable costs } & 600 & 300 &- \\\hline \text { Less fixed costs } & 200 & 500 & 800 \\\hline \text { Net income } & \$ 200 & \$200 &\$ 200 \\\hline\end{array}$
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.