department for a recent quarter is presented below: THE RHYTHM SHOP Income Statement-Acoustic Guitar Department For the Quarter Ended March 31 Sales Cost of goods sold $2,610,000 1,160,000 Gross margin 1,450,000 Selling and administrative expenses: Selling expenses Administrative expenses $ 490,000 290,000 780,000 Operating income $ 670,000 The guitars sell, on average, for $900 each. The department's variable selling expenses are $84 per guitar sold. The remaining selling expenses are fixed. The administrative expenses are 30% variable and 70% fixed. The company purchases its guitars from several suppliers at an average cost of $400 per guitar. Required: 1. Prepare an income statement for the quarter using the contribution approach.