=+4-52 KKK Variable and absorption costing and break-even points OBJECTIVES 1, 2, 4, APPENDIX 4-1 Tabby Cat Tree Ltd (TCT) builds luxury cat trees and sells them through the internet to cat owners who want to provide their cats with a more natural environment. At the start of 2013, TCT carried no inventory. During the year, they produced 1000 cat trees and sold 800 cat trees for $300 each. Fixed production costs were $100000 and variable production costs were $75 per cat tree.

Fixed advertising, website page and other general and administrative expenses were $50000 and variable shipping costs were

$25 per tree.

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