Problem 6A-7

Problem 6A-7 (Algo) Cost Behavior; High-Low Method; Contribution Format Income Statement [LO6-10 Morrisey \& Brown, Limited, 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: Required: 1. By analyzing the data from the company's income statements, classify each of its expenses (including cost of goods sid) as elther variable, fixed, or mixed. 2. Using the high-low method, separate each mixed expense into variable and fixed elements. Express the variable and flxed portions of each mixed expense in the form y=a+bX 3. Redo the company's income statement at the 9,000 -unit level of activity using the contribution format