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July August 11,000 10,000 $ 165,000 $150,000 72,600 66,000 92,400 84,000 Sales in units Sales Cost of goods sold Gross margin Selling and administrative expenses:
July August 11,000 10,000 $ 165,000 $150,000 72,600 66,000 92,400 84,000 Sales in units Sales Cost of goods sold Gross margin Selling and administrative expenses: Rent Sales commissions Maintenance expenses Depreciation Total selling and administrative expenses Net operating income $ 12,000 $ 13,200 $ 13,500 $ 25,000 $ 63,700 $ 28,700 $ 12,000 $ 12,000 $ 13,000 $ 25,000 $ 62,000 $ 22,000 All of the company's costs are either fixed variable, or a mixture of the two (i.e., mixed). Assume that the relevant range includes all of the activity levels mentioned in this problem. 1. Identify each of the company's expenses (including cost of goods sold) as either variable, fixed, or mixed. 2. Using the high-low method, separate each mixed expense into variable and fixed elements. State the cost formula for each mixed expense. 3- Redo the company's income statement at the 10,000-unit level of activity using the contribution format. 4. Calculate the break-even point in units (Rounded)
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