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: Horrisey & Broun, Ltd. Income Statements For the Three Months Ended September 30 Sales in units July 4,000 August 4, s00 September 5,000 Sales Cost of goods sold $400, 000 240,000 $450, 000 270,000 $500, 000 300, 000 Gross margin 160, e00 180, 000 200, 000 Selling and administrative expenses Advertisins expense Shipping expense Salaries and commissions Insurance expense Depreciation expense 21,000 34,000 78,000 21,000 36, 000 84,000 6,000 15,000 21,000 38,000 90,000 6,000 15, 000 6,000 15,000 Total selling and administrative expenses 154,000 162,000 170, 000 Net operating income $ 6,000 $ 18,000 $ 30,000 Required: 1. Identify each of the company's expenses (including cost of goods sold) as either variable, fixed, or mixed. Expenses Classification Cost of goods sold Advertising expense Shipping expense Salaries and commissions Variable Fixed Mixed Mixed Fixed Fixed Insurance expense Depreciation expense

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: Horrisey & Broun, Ltd. Income Statements For the Three Months Ended September 30 Sales in units July 4,000 August 4, s00 September 5,000 Sales Cost of goods sold $400, 000 240,000 $450, 000 270,000 $500, 000 300, 000 Gross margin 160, e00 180, 000 200, 000 Selling and administrative expenses Advertisins expense Shipping expense Salaries and commissions Insurance expense Depreciation expense 21,000 34,000 78,000 21,000 36, 000 84,000 6,000 15,000 21,000 38,000 90,000 6,000 15, 000 6,000 15,000 Total selling and administrative expenses 154,000 162,000 170, 000 Net operating income $ 6,000 $ 18,000 $ 30,000 Required: 1. Identify each of the company's expenses (including cost of goods sold) as either variable, fixed, or mixed. Expenses Classification Cost of goods sold Advertising expense Shipping expense Salaries and commissions Variable Fixed Mixed Mixed Fixed Fixed Insurance expense Depreciation expense

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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