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 $ 980,000

Cost of goods sold 680,000

Gross margin 300,000

Selling and administrative expenses

Selling $ 110,000

Administration 124,000 234,000

Net operating income $ 66,000

On average, a book sells for $70. Variable selling expenses are $4per book with the remaining selling expenses being fixed. The variable administrative expenses are 3% of sales with the remainder being fixed.

The contribution margin for Sam's Bookstore for the first quarter is:

Multiple Choice

$214,600

$765,400

$244,000

$894,600