Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassiness Kataskeves, S.A Income Statement-Bilge Pump For the Quarter Ended March 31 Sales $480,000 Variable expenses $125,000 Variable manufacturing expenses 42,000 Sales commissions 14,000 Shipping 181,000 Total variable expenses 299,000 Contribution margin Fixed expenses: Advertising 22,000 Depreciation of equipment (no resale value) 117,000 32,000 General factory overhead Salary of product-line manager 113,000 10,000 Insurance on inventories Purchasing department 43,000t Total fixed expenses 337.000 Net operating loss (38,000 *Common costs allocated on the basis of machine-hours. tCommon costs allocated on the basis of sales dollars