Managerial Accounting: Chapter 6: Cost-Volume-Profit Relationships

Morrisey & Brown, Ltd, of Sydney is a merchandising company that is the sole distributor of a product that is increasing in popularity among Australian consumers. The company's income statements for the three most recent months follow Morrisey Brown, Ltd. Income Statements For the Three Months Ended September 30 July Sales in units 4,750 Sales 6546,250 Coat of goods sold 327.750 GEOSS margin 218,500 Selling and administrative expenses: Advertising expense 31,800 Shipping expense 35,500 Salaries and commissions 81,000 Insurance expense 6, 550 Depreciation expense 19.000 Total selling and administrative expenses 172,850 Net operating income $ 45,650 August 5,250 6603, 750 362,250 241, 500 September 5,750 $ 661,250 396,750 264,500 31,800 38.100 87,300 6.550 10,000 181.750 $ 59,750 31,800 40, 700 93,600 6,550 18,000 190, 650 6 73,50 Required: 1. By analyzing the data from the company's income statements, classify each of its 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 foed elements. Express the variable and fixed portions of each mixed expense in the form Y= bX. 3. Redo the company's income statement at the 5,750-unit level of activity using the contribution format. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 By analyzing the data from the company's income statements, dassify each of its expenses (including cost of goods sold) as either variable, fixed, or mixed. Classification Expenses Cost of goods sold Advertising expense Shipping expense Salaries and commissions n expense Depreciation expense Required 2 >