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: Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Sales Variable expenses: Sales commissions $ 400,000 Variable manufacturing expenses $ 121,000 46,000 Shipping 21,000 Total variable expenses 188,000 Contribution margin 212,000 Fixed expenses: Depreciation of equipment (no resale value) General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. Advertising (for the bilge pump product line) 21,000 119,000 34,000 126,000 5,000 50,000 355,000 $ (143,000)