Problem for Chapter 20 Use the following data to construct an income statement for Cheryl's posters: Sales price $20 per unit Variable Cost $10 per unit Fixed costs $5,000 Sales in Units 1,000 Required: 1. Calculate the Earnings before Interest and Taxes (EBIT) for Cheryl's Posters using the data provided above. 2. Prepare two pro forma income statements assuming: a 50% increase in sales (1,500) a 50% decrease in sales (500) 3. What is the impact on earnings before interest and taxes (EBIT) of the 50% increase/decrease in sales? 4. Explain using the concept of leverage