1.Prepare a schedule that outlines the variances for each category of the contribution

income statement that reconciles actual operating income from 2016 to 2017.

2. For decision-making purposes, prepare a contribution margin income statement using standard costs information.

Wheels of Fortune Operating Income Statement Bicycles Sold 4,500 4,500 2016 Per Bicycle 2017 Per Bicycle Sales Dollars $ 18,675,000 $4,150,00 $ 10,575,000 $2,350,00 $ $ Direct Material Costs Direct Labor Costs Variable Overhead Total Variable Costs 10,260,000 1,503,000 540,000 12.303,000 $2,280.00 334.00 120,00 $2,734,00 6,688,000 1.473,120 447,750 8,608,870 $1.486.22 327.36 99.50 1.913.08 $ $ $ 6,372,000 34.12% $1,416.00 $ Contribution Margin Contribution Margin Percent $436.92 1,966, 130 18.59% Selling & General Administration $ 615,000 136.67 $ 765,000 170.00 Operating Income 5.757,000 $1,279.33 $ 1,201,130 $266.92 Wheels of Fortune Standard Costs Summary of Standard Costs Professional | Bicycle Kit per unit S 3,000S Direct labor hours per bicycle 10 Direct labor male per hour s 40 S Variable overhead rate per bicycle S 150 S Novice 600 6 30 Wheels of Fortune Summary of Actual Costs Professional 2016 2017 Bicycle Kit: Usage 3.150 1,400 Price 3.000 IS3.200 Direct labor hours 31.500 15,525 Direct labor rate per hour 40S 44 Variable overhead per bicycle 150S 180 Novice Bicycle Kit: Usage Price Direct labor hours Direct labor rate per hour Variable overhead per bicycle 2016 2017 1,3503 .200 600 IS 690 8.100 20.790 30 IS 50 S 65