Hugable Hippos is a specialty pet gift shop selling exotic pet$-$related items online. The shop has no physical location. Results for last year are shown next:

$($Click the icon to view the results.$)$

For internal planning and decision$-$making purposes, the owner of Hugable Hipposwould like to translate the company's income statement into the contribution margin format. Since Hugable Hippos is online only, all of its cost of goods sold is variable. A large portion of the selling and marketing expenses consists of freight$-$out charges $($$$19,600),$ which were also variable. Only $20\%$ of the remaining selling and marketing expenses and $25\%$ of the website expenses were variable. Of the other operating expenses, $90\%$ were fixed. Based on this information, prepare Hugable Hippos' contribution margin income statement for last year.

Hugable Hippos

Contribution Margin Income Statement

For the Year Ended December $31$

$\backslash$table$[[$Sales revenue,$996,000],[$Less:$,$Variable expenses$],[$Cost of goods sold,$672,000],[$Variable selling and marketing expenses,$],[$Fixed website maintenance expenses,$],[$Other variable operating expenses,$],[$Total variable expenses,$],[$Less:$,$Fixed expenses,$],[$Fixed selling and marketing expenses,$],[$Fixed website maintenance expenses,$],[$Other fixed operating expenses,$],[$Total fixed expenses,$]]$

Data table

$\backslash$table$[[,$A$,$B$,,$C$],[1,$Hugable Hippos$],[2,$Traditional Income Statement $($Absorption Costing$)],[3,$For the Year Ended December $31],[4,$Sales revenue,,$$,996,000],[5,$Less: Cost of goods sold,,,$672,000],[6,$Gross profit,,$$,324,000],[7,$Less operating expenses:,,,$],[8,$Selling and marketing expenses,$65,000,,],[9,$Website maintenance expenses,$56,500,,],[10,$Other operating expenses,$18,000,,139,500],[11,$Operating income,,$$,184,500]]$