Exercise 19-8 Contribution margin format income statement LO P2

Polarix is a retailer of ATVs (all-terrain vehicles) and accessories. An income statement for its Consumer ATV Department for the current year follows. ATVs sell for $3,400 each. Variable selling expenses are $300 per ATV. The remaining selling expenses are fixed. Administrative expenses are 70% variable and 30% fixed. The company does not manufacture its own ATVs; it purchases them from a supplier for $1,830 each.

POLARIX Income StatementConsumer ATV Department For Year Ended December 31, 2017
Sales				$	656,200
Cost of goods sold					353,190
Gross margin					303,010
Operating expenses
Selling expenses	$	155,000
Administrative expenses		40,900			195,900
Net income				$	107,110

Required:

1. Prepare an income statement for this current year using the contribution margin format. (Round contribution margin per ATV to the nearest dollar amount.)