Toxaway Company is a merchandiser that segments its business into two divisions- Commercial and Residential. The company's accounting intern was asked to prepare segmented income statements that the company's divisional managers could use to calculate their break-even points and make decisions. She took the prior month's companywide income statement and prepared the absorption format segmented income statement shown below Sales Cost of goods sold $1,005,000 $335,000 $670,000 670,000 180,900489,100 Gross margin Selling and administrative expenses 335,000 154,100 180,900 308,000138,000 170,000 Net operating income S 27,000 16,100 $ 10,900 In preparing these statements, the intern determined that Toxaway's only variable selling and administrative expense is a 10% sales commission on all sales. The company's total fixed expenses include $61,500 of common fixed expenses that would continue to be incurred even if the Commercial or Residential segments are discontinued, $62,000 of fixed expenses that would be avoided if the Residential segment is dropped and $84,000 of fixed expenses that would be avoided if the.Commericial segment is dropped Required: 1. Do you agree with the intern's decision to use an absorption format for her segmented income statement? Yes 2-a. Based on the intern's segmented income statement, can you determine how she allocated the company's common fixed expenses to the Commercial and Residential segments? Residential Common fixed expenses