Vulcan Companys contribution format income statement for June is as follows:

Vulcan Company
Income Statement
For the Month Ended June 30
Sales	$ 900,000
Variable expenses	408,000
Contribution margin	492,000
Fixed expenses	455,000
Net operating income	$ 37,000

Management wants to improve profits and gathered the following data:

The company is divided into two sales territoriesNorthern and Southern. The Northern Territory recorded $400,000 in sales and $208,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern Territory. Fixed expenses of $164,000 and $125,000 are traceable to the Northern and Southern Territories, respectively. The rest of the fixed expenses are common to the two territories.

The company is the exclusive distributor for two productsPaks and Tibs. Sales of Paks and Tibs totaled $150,000 and $250,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks and 70% for Tibs. Cost records show $67,500 of the Northern Territorys fixed expenses are traceable to Paks and $60,000 to Tibs, with the remainder common to the two products.

Required:

1-a. Prepare contribution format income statements for the total company segmented by sales territories.

1-b. Prepare contribution format income statements for the Northern Territory segmented by product line.