Required: 1. Prepare an income statement for the current year using the contribution margin format. (Do not round intermediate calculations. Round contribution margin per ATV value to the nearest whole number.)

Exercise 06-8 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 $4,200 each. Variable selling expenses are $290 per ATV. The remaining selling expenses are fixed. Administrative expenses are 20% variable and 80% fixed. The company does not manufacture its own ATVs; it purchases them from a supplier for $1,870 each. POLARIX Income Statement-Consumer ATV Department For Year Ended December 31 Sales $680,400 Cost of goods sold 302,940 Gross margin 377,460 Operating expenses Selling expenses $130,000 Administrative expenses 42,200 172,200 Net income $205,260 POLARIX Income Statement - Consumer ATV Department For Year Ended December 31 Net income (loss) 2. For each ATV sold during this year, what is the contribution toward covering fixed expenses and earning income? Contribution margin per ATV