The Central Valley Company is a manufacturing firm that produces and sells a single product. The company's revenues and expenses for the last four months are given below. May Central Valley Company Comparative Monthly Income statements March April 5,800 5,300 $765,600 $699,600 391,600 365,100 374,000 334,500 6,050 $798,600 399,850 398,750 June 6,600 $871,200 434,000 437,200 Sales in units Sales revenue Less: Cost of goods sold Gross margin Less: Operating expenses Shipping expense Advertising expense Salaries & commissions Insurance expense Depreciation expense Total operating expenses Net income 68,300 78,000 175,400 9,800 47,000 378,500 $ (4,500) 63,300 78,000 158,600 9,800 47,000 356,700 $(22,200) 71,550 78,000 176, 100 9,800 47,000 382,450 $ 16,300 75,000 78,000 188,500 9,800 47,000 398,300 $ 38,900 Required: 1. Management is concerned about the losses experienced during the spring and would like to know more about the cost behaviour. Develop a cost equation for each of the costs. Y = + COGS Shipping Salaries and commissions + Y Y X X x 11 + 2. Using the cost equations, prepare a contribution margin income statement in good form) for September when 6,300 units are expected to be sold. CENTRAL VALLEY COMPANY Contribution Income Statement For the month ended September 30 Variable costs: 0 Less fixed costs: $ 0