Fashionisto Incorporated is an upscale clothing store in New York City and London. Each store has two main departments, Mens Apparel and Womens Apparel. Marie Phelps, Fashionistos CFO, wants to use strategic performance measurement to better understand the companys financial results. She has decided to use the profit center method to measure performance and has gathered the following information about the two stores and the two departments of the New York City store:

Total net sales $ 3,500,000

Fixed costs Partly traceable and controllable 250,000

Partly traceable but noncontrollable 220,000

Nontraceable costs 70,000

Total net sales (percent) London store 40% New York store 60 New YorkMens Apparel 40 New YorkWomens Apparel 60 Cost of goods soldvariable (percent of sales) London store 52% New YorkMens Apparel 45 New YorkWomens Apparel 60 Variable operating costs (percent of sales) London store 36% New YorkMens Apparel 22 New YorkWomens Apparel 32 Fixed controllable costspartly traceable (percent of total) London store 40% New York total 40 Mens Apparel 45 Womens Apparel 40 Could not be traced to Mens or Womens Apparel 15 Could not be traced to London or New York 20 Fixed noncontrollable costspartly traceable (percent of total) London store 50% New York total 40 Mens Apparel 35 Womens Apparel 15 Could not be traced to Mens or Womens Apparel 50 Could not be traced to London or New York 10

Required: 1. Using this information, prepare a contribution income statement for Fashionisto.