Apex Tile Company makes a standard and a premium grade of tiles. The standard grade is sold at $20 per square foot, and the premium grade is sold at $35 per square foot. The variable cost of making the standard grade is $12 per square foot. It costs an extra $6 per square foot to make the premium grade. It takes 12 labor hours to make 100 square feet of the standard grade and 18 labor hours to make 100 square feet of the premium grade. There are 5,000 hours of labor time available for production each week. The maximum weekly sales for the standard and the premium grade are 25,000 and 10,000 square feet, respectively. Fixed production costs total $700,000 per year. All selling costs are fixed.

Required: (a) Calculate the optimal production level in number of square feet for each product. (b) Prepare an income statement for the company based on the optimal production level. (c) Determine the break-even point in square feet for each grade of tile.