Exercise $11-12$A $($Algo$)$ Using fixed cost as a competitive business strategy LO $11-2$

The following income statements illustrate different cost structures for two competing companies:

$\backslash$table$[[,,,,],[,$Income Statements,$],[,$Company,Name,,$],[$Number of customers $(a),90,$Perez,,$],[$Sales revenue $(a$$$240),$$$21,600,$$$21,090,,],[$Variable cost $(a$$$180),\frac{N}{A},(16,200),,],[$Contribution margin,$21,600,5,400,,],[$Fixed cost$,(16,200),0,,],[$Net income,$$5,400,$$$5,400,,]]$

Required

a$.$ Reconstruct Rundle's income statement, assuming that it serves $180$ customers when it lures $90$ customers away from Perez by lowering the sales price to $$140$ per customer.

b$.$ Reconstruct Perez's income statement, assuming that it serves $180$ customers when it lures $90$ customers away from Rundle by lowering the sales price to $$140$ per customer.

Complete this question by entering your answers in the tabs below.