Question

Cosgrove Company, Inc. is a wholesaler that distributes a single product. The company's revenues and expenses...

Cosgrove Company, Inc. is a wholesaler that distributes a single product. The company's revenues and expenses for the last three months are given below:

April may june

sales in units 3000 3750 4500

sales revenue 420000 525000 630000

cost of goods sold 168000 210000 252000

gross margin 252000 315000 378000

selling&admin expenses

shipping expenses 44000 50000 56000

advertising 70000 70000 70000

salaries&commis 107000 125000 143000

insurance 9000 9000 9000

depreciation 42000 42000 42000

total selling and admin expenses 272000 296000 320000

net operating income (loss) (20000) 19000 58000

Required:

a.Identify the fixed and variable costs associated with Cosgrove.

b. Calculate the average costs per month.

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