1. Cebu Diamond manufactures a single product.For 2020, the company had sales of P500,000, variable costs of P150,000, and fixed costs of P300,000.Marquez expects its cost structure and sales price per unit to remain the same in 2021; however total sales are expected to jump by 5%.If the 2021 projections are realized, net income in 2021 should exceed net income in 2020.

2. New Worldwide produces three products from a joint process costing P150,000. The following information is available:

Units Sales Price Cost to Process (Split-Off) Further Sales Price (After Further) A 15,000 P35 P90,000 P40 B 20,000 P30 P20,000 P35 C 10,000 P45 P40,000 P50