An income statement for Bob's Bookstore for the first quarter of the year is presented below:

Bob's Bookstore
Income Statement
For Quarter Ended March 31
Sales			$	950,000
Cost of goods sold				660,000
Gross margin				290,000
Selling and administrative expenses
Selling	$	106,000
Administration		116,000		222,000
Net operating income			$	68,000

On average, a book sells for $50. Variable selling expenses are $4 per book with the remaining selling expenses being fixed. The variable administrative expenses are 5% of sales with the remainder being fixed.

The net operating income using the contribution approach for the first quarter is: