3) The Raymond's Ltd. is a large retailer of equipment for pickup trucks. An income statement for the company's Bed Liner Department for the most recent quarter is presented below: Raymond's Ltd. Income Statement - Liner Department for First Quarter of Current Year Sales $700,000 Less: Cost of goods sold 250,000 Gross margin $450,000 Less: Operating expenses: Selling expenses $195,000 Administrative expenses 145,000 340,000 Net income $110,000 The liners sell, on average, for $350 each. The department's variable selling expenses are $35 per liner sold. The remaining selling expenses are fixed. The administrative expenses are 25% variable and 75% fixed. The company purchases its liners from a supplier at a cost of $125 per liner. Required: Prepare an income statement for the quarter, using the contribution approach