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: August 7,000 $ 700,000 420,000 280,000 September 7.500 $750,000 450,000 300,000 Morrisey & Brown, Ltd. Income Statements For the Three Months Ended September 30 July Sales in units 6,500 Sales $ 650, eee cost of goods sold 390,000 Gross margin 260,000 Selling and administrative expenses Advertising expense 25,00 Shipping expense 69,000 Salaries and commissions 110,000 Insurance expense 9,750 Depreciation expense 16.400 Total selling and administrative expenses 238,950 Net operating income $ 21,050 25,800 73,000 125,000 9,750 16,40) 249, 956 30.050 25,800 17,000 132,000 9,750 16,400 260,950 39,050 $ Required: 1. By analyzing the data from the company's income statements, classily 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 fixed elements. Express the variable and fixed portions of each mixed expense in the form Y = a +bX 3. Redo the company's income statement at the 7.500-unit level of activity using the contribution formal