Pittman Company is a small but growing manufacturer of telecommunications equipment. The company has no sales force of its own; rather, it relies completely on independe t sales agents to market its products. These agents are paid a sales commission of 15% or a items sold. nts Barbara Cheney. Pittman's controller, has just prepared the company's budgeted income statement for next year as follows: Pittman Company Budgeted Income Statement For the Year Ended December 31 eBook Print eferences Sales Manufacturing expenses $21,000,000 Variable Pixed overhead 9,450,000 2,940,000 12,390,000 Gross margin Selling and administrative expenses Commissions to agents Fixed marketing expenses Fixed administrative expenses 3,150,000 147,000 2,000,000 5,297,000 Net operating incone Fixed interest expenses Income before income taxes Income taxes (304) Net income 735,000 2,578,000 773.400 s 1,804,600 Primarily depreciation on storage facilities. As Barbara handed the statement to Karl Vecci, Pittman's president, she commented."I went ahead and used the agents' 15%