ABC and XYZ Companies have the following sales, variable cost, and fixed cost.
ABC XYZ
Sales $50,000 $50,000
Variable Costs $10,000 $30,000
Fixed Costs $30,000 $10,000
If sales increase by $10,000 at each company, then:
a. ABC profits will increase by $2,000.
b. XYZ profits will increase by $4,000.
c. ABC and XYZ profits will increase by $4,000 and $6,000.
d. XYZ profits will increase by $8,000.