2. Prepare the contribution margin income statement at the calculated sales level

Stancil Dry Cleaners has determined the following about its costs: Total variable expenses are $38,000, total fixed expenses are $32,000, and the sales revenue needed to break even is $40,000. Determine the company's current 1) sales revenue and 2) operating income. (Hint: First, find the contribution margin ratio; then prepare the contribution margin income statement.) Use the contribution margin income statement and the shortcut contribution margin approaches to determine Stancil's current (1) sales revenue and (2) operating income. Begin by computing the contribution margin ratio. (Enter the result as a whole number.) The contribution margin ratio is