Prepare a contribution margin income statement (Learning Objective 6)

Pam's Quilt Shoppe sells homemade Amish quilts. Pam buys the quilts from local Amish artisans for \(\$ 250\) each, and her shop sells them for \(\$ 350\) each. Pam also pays a sales commission of \(5 \%\) of sales revenue to her sales staff. Pam leases her country-style shop for \(\$ 1,000\) per month and pays \(\$ 1,200\) per month in payroll costs in addition to the sales commissions. Pam sold 80 quilts in February. Prepare Pam's traditional income statement and contribution margin income statement for the month.