3 The Rhythm Shop is a large retailer of acoustic, electric, and bass guitars. An Income statement fort company's acoustic guitar department for a recent quarter is presented below: THE RHYTHM SHOP Income Statement-Acoustic Guitar Department For the Quarter Ended March 31 Sales Cost of goods sold 01:39:15 $2,850,000 1,350,000 1,500,000 Gross margin Selling and administrative expenses Selling expenses Administrative expenses Operating income $ 500,000 300,000 800,000 $ 700,000 The guitars sell, on average, for $950 each. The department's variable selling expenses are $85 per guitar sold. The remaining selling expenses are fixed. The administrative expenses are 20% variable and 80% fixed. The company purchases Its guitars from several suppliers at an average cost of $450 per guitar Required: 1. Prepare an income statement for the quarter using the contribution approach THE RHYTHM SHOP Income Statement-Acoustic Guitar Department For the Quarter Ended March 31 Sales $ 2.850.000 Variable expenses Cost of goods sold $ 1.350.000 Selling expenses 245.000 Administrative expenses 1,850,000 Contribution margin 1,000,000 Fixed expenses Soling expenses Administrative uxpenses Operating income S 1.000.000 Me Gea Hill