Maryland Novelties Company produces and sells souvenir products. Monthly income statements for two activity levels are provided below:

Unit volumes	21,600 units	32,400 units
Revenue	$ 162,000	$ 243,000
Less cost of goods sold	64,800	97,200
Gross margin	$ 97,200	$ 145,800
Less operating expenses
Salaries and commissions	21,600	27,000
Advertising expenses	32,400	32,400
Administrative expenses	13,500	13,500
Total operating expenses	67,500	72,900
Net income	$ 29,700	$ 72,900

Required

1. Identify each of the following expenses as fixed, variable, or mixed.
2. Use the high-low method to separate the mixed costs into variable and fixed components.
3. Prepare a contribution margin income statement at the 21,600-unit level.

a. Identify each of the following expenses as fixed, variable, or mixed. b. Use the high-low method to separate the mixed costs into variable and fixed components. c. Prepare a contribution margin income statement at the 21,600-unit level. Complete this question by entering your answers in the tabs below. Identify each of the following expenses as fixed, variable, or mixed