Millard Corporation is a wholesale distributor of office products. It purchases office products from manufacturers and distributes them in the West, Central, and East regions. Each of these regions is about the same size and each has its own manager and sales staff. The company has been experiencing losses for many months. In an effort to improve performance, management has requested that the monthly income statement be segmented by sales region. The company's first effort at preparing a segmented income statement for May is given below. Sales West $311,000 Sales Region Central $802,000 East $703,000 Regional expenses (traceable): Cost of goods sold 92,000 237,000 317,000 Advertising 109,000 241,000 236,000 Salaries 54,000 52.000 105,000 Utilities 9,300 16,100 14,000 Depreciation 22,000 31,000 26,000 Shipping expense 17,000 25,000 40,000 Total regional expenses 303,300 602.100 738,000 Regional income (loss) before corporate expenses 7,700 199,900 (35,000) Corporate expenses: Advertising (general) 14,000 43,000 38,000 General administrative expense 19,000 19.000 19,000 Total corporate expenses 33,000 62.000 57.000 Net operating income (loss) $ (25,300) $137.900 $(02.000) The cost of goods sold and shipping expense are both variable. All other costs are fixed.