IBM provides IT services using mixed costing. In July 2028, the company incurs the following costs related to its service operations:

• Fixed Costs: $60 million
• Variable Costs: $30 million
• Semi-Variable Costs: $20 million

Required:

• Classify each cost as fixed, variable, or semi-variable.
• Calculate the total operating costs for IBM.
• Determine the cost per service unit assuming 2 million units delivered.
• Analyze the cost behavior of mixed costs in information technology services.
• Discuss the implications of cost classification on service pricing decisions.