The Autotruck Shop is a large retailer of equipment for pickup trucks. An income statement for the company's Bed Liner Department for the most recent quarter is presented below: The Autotruck Shop Income Statement - Liner Department for the First Quarter of Current Year Sales $700,000 250,000 $450,000 Less: Cost of goods sold Gross margin Less: Operating expenses: Selling expenses Administrative expenses $200,020 190,000 390,020 $59,9801 Net income The liners sell, on average, for $350 each. The department's variable selling expenses are $35 per liner sold. The remaining selling expenses are fixed. The administrative expenses are 25% variable and 75% fixed. The company purchases its liners from a supplier at a cost of $125 per liner. Required: Prepare an income statement for the quarter, using the contribution approach. The liners sell, on average, for $350 each. The department's variable selling expenses are $35 per liner sold. The remaining selling expenses are fixed. The administrative expenses are 25% variable and 75% fixed. The company purchases its liners from a supplier at a cost of $125 per liner. Required: Prepare an income statement for the quarter, using the contribution approach. Part B Wright Corporation's contribution format income statement for last month appears below: Sales Less: variable expenses Contribution margin Less: fixed expenses Operating income $45,000 27,000 18,000 12.000 $6,000 There were no beginning or ending inventories. The company produced and sold 3,000 units during the month. Required: If sales decrease by 500 units in the next month, by how much would fixed expenses have to be reduced to maintain the current operating income