Polarix is a retailer of ATVs (all-terrain vehicles) and accessories. An income statement for its Consumer ATV Department for the current year follows. ATVs sell for $4,000 each. Variable selling expenses are $300 per ATV. The remaining selling expenses are fixed. Administrative expenses are 60% variable and 40% fixed. The company does not manufacture its own ATVs; it purchases them from a supplier for $1,890 each.

POLARIX Income StatementConsumer ATV Department For Year Ended December 31
Sales				$	640,000
Cost of goods sold					302,400
Gross margin					337,600
Operating expenses
Selling expenses	$	130,000
Administrative expenses		42,600			172,600
Net income				$	165,000

Required: 1. Prepare an income statement for the current year using the contribution margin format. (Do not round intermediate calculations. Round contribution margin per ATV value to the nearest whole number.)

2.For each ATV sold during the year, what is the contribution covering fixed expenses and earning income?