Bovine Company, a wholesale distributor of umbrellas, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales Variable expenses Contribution margin Fixed expenses Operating loss $2,190,000 887,520 1,302,480 1,343,000 $ (40,520) In an effort to isolate the problem, the president has asked for an income statement segmented by geographic market. Accordingly, the Accounting Department has developed the following: Sales Variable expenses as a percentage of sales Traceable fixed expenses Geographic Market South Central North $619,000 $818,000 $753,000 508 328 42% $350,000 $528,000 $319,000 Required: 1. Prepare a contribution format income statement segmented by geographic market, as requested by the president. Geographic Market Central Total South North Company 2-a. The company's sales manager believes that sales in the Central geographic market could be increased by 10% if monthly advertising is increased by $44,000. Calculate the incremental net operating income. Incremental net operating income 2-b. Would you recommend the increased advertising? Yes