Cherokee Incorporated is a merchandiser that provided the following information:

Cherokee, Incorporated Traditional Income Statement Sales $ 195,000 Cost of goods sold 76,000 119,000 Gross margin Selling and administrative expenses: Selling expenses $ 26,000 X Administrative expenses 13,000 X Fixed manufacturing overhead X 32,000 X 71,000 102,000 X Net operating income $ Cherokee, Incorporated Contribution Format Income Statement Variable expenses: O Fixed expenses: 0 Number of units sold Selling price per unit Variable selling expense per unit Variable administrative expense per unit Total fixed selling expense Total fixed administrative expense Beginning merchandise inventory Ending merchandise inventory Merchandise purchases Amount 13,000 $ 15 $ 1 $ 2 $ 19,000 $ 13,000 $ 11,000 $ 22,000 $ 87,000 Required: 1. Prepare a traditional income statement. 2. Prepare a contribution format income statement