The following information is available for Rick’s Watch Company for 2004:

Required: Prepare a contribution income statement for the year ended December 31, 2004.

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Percent Percent Amount Fixed Variable Direct material $534,000 100 Direct labor 129,000 100 Variable manufacturing overhead 397,000 100 Fixed manufacturing overhead 998,000 100 Selling cost 196,000 33 Administrative cost 243,000 78 162 67 22 Sales for 2004 totaled $2,745,000 and there were no beginning or ending inventories.