Morrisey & Brown, Ltd, of Sydney, Australia, is a merchandising firm that is the sole distributor of
Question:
Morrisey & Brown, Ltd, of Sydney, Australia, is a merchandising firm 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:
Required:
1. Identify each of the company?s expenses (including cost of goods sold) as being variable fixed, or mixed.
2a. Using the high-low method, separate each mixed expense into variable and fixed elements.
2b. Using the high-low method, state the cost formula for each mixed expense.
3. Redo the company?s income statement at the 6,000-unit level of activity using the contribution format.
Management Accounting Information for Decision-Making and Strategy Execution
ISBN: 978-0137024971
6th Edition
Authors: Anthony A. Atkinson, Robert S. Kaplan, Ella Mae Matsumura, S. Mark Young