E22-2 Riley Watches April income statement follows: RILEY WATCHES Income Statement For the Month of April 20XX Sales revenue. $720,000 Cost of goods sold. 448.000 Gross profit 272.000 Operating expenses: Marketing expense. $92,000 General and administrative expense. 42,000 134,000 Operating income. $138.000 Riley's cost of goods sold is a variable expense. Marketing expense is 30% fixed and 70% variable. General and administrative expense is 60% fixed and 40% variable. Required 1. Prepare Riley's contribution margin income statement for April. 2. Compute the expected increase in operating income to the nearest $1.000 if sales increase by $50,000.