An income statement for Sam's Bookstore for the first quarter of the year is presented below: Sam's Bookstore Income Statement For Quarter Ended March 31 Sales: $ 1,000,000 Cost of goods sold Gross margin 665,000 335,000 Selling and administrative expenses Selling Administrative. $ 107,000 118,000 Net operating income 225,000 $110,000 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 3% of sales with the remainder being fixed. The net operating income using the contribution approach for the first quarter is Multiple Choice $335,000 $255,000 $225,000 $110,000