Shoe Shock Innovations manufactures athletic shoe inserts that cushion the foot and reduce the impact of exercise on the joints. The company has two divisions, Sole Inserts and Heel Inserts. A segmented income statement from last month follows. Sole Inserts Division Heel Inserts Division Total Shoe Shock Sales revenue Less variable expenses Contribution margin $491,900 309,000 182,900 122,200 $60,700 $2,537,000 2,016,000 521,000 349,200 $171,800 $3,028,900 2,325,000 703,900 471,400 232,500 171,600 Less traceable fixed expenses Segment margin Common fixed costs Net operating income $60,900 Chris Kelly is Shoe Shock's sales manager. Although this statement provides useful information, Chris wants to know how well the company's two distribution channels, specialty footwear stores and drug stores, are performing. Marketing data indicates that 20% of sole inserts and 75% of heel inserts are sold through specialty footwear stores. A recent analysis of corporate fixed costs revealed that 50% of all fixed costs are traceable to specialty footwear stores and 45% of all fixed costs to drug stores. Prepare a segment margin income statement for Shoe Shock's two distribution channels. (If the amount is negative then enter with a negative sign preceding the number, e.g.-5,125 or parenthesis, eg. (5,125).) Specialty Footwear Stores Drug Stores Total Shoe Shock e Textbook and Media Based on your analysis, what recommendations would you make to the company? should be dropped