Question: 1. The following information is available for ABC Company: Variable Cost = $1 per unit Total Fixed Cost = $5,000 Price per Unit = $5

1. The following information is available for ABC Company:

Variable Cost = $1 per unit

Total Fixed Cost = $5,000

Price per Unit = $5

a) Calculate the Break Even Point in Units _________________

b) What would have been the Net Income if 3000 units had been sold? $___________________ (HINT: prepare an income statement adjusting only the numbers that vary with the number of units sold) DO NOT USE DOLLAR SIGNS IN YOUR ANSWER.

	A.	a) 1250; b) 7000
	B.	a) 7000; b) 12000
	C.	a) 1250 b) 12000

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