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Poolco builds and installs swimming pools. The company will discount the price of a pool to its employees that choose to have one built. Given

Poolco builds and installs swimming pools. The company will discount the price of a pool to its employees that choose to have one built. Given the information shown below, how much would an employee have to include as income if he took advantage of this discount?

Normal Poolco's Employee's

Selling Price Cost Cost

Materials $2,500 $1,750 $1,625

Labor 2,500 1,250 1,625

$5,000 $3,000 $3,250

a.

$1,750

b.

$750

c.

$500

d.

$0, because employee's cost exceeds Poolco's cost

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