Cherokee Incorporated is a merchandiser that provided the following information:

	Amount
Number of units sold	14,000
Selling price per unit	$ 16
Variable selling expense per unit	$ 2
Variable administrative expense per unit	$ 2
Total fixed selling expense	$ 20,000
Total fixed administrative expense	$ 15,000
Beginning merchandise inventory	$ 11,000
Ending merchandise inventory	$ 25,000
Merchandise purchases	$ 85,000

Required:

1. Prepare a traditional income statement.

2. Prepare a contribution format income statement.