Sharp Company makes and sells pencil sharpeners. The variable cost of each sharpener is $20. The sharpeners are sold for $30 each. Fixed operating expenses amount to $40,000.

b-1. Determine the sales volume in units and dollars that is required to attain a profit of $12,000.

b-2. Prepare an income statement using the contribution margin format to verify your answer.

c. Determine the margin of safety between sales required to attain a profit of $12,000 and break-even sales.