Westfall Watches has two productlines: Luxury watches and Sporty watches. Income statement data for the most recent yearfollow:

Total Luxury Sporty Sales revenue $530,000 $400,000 $130,000 Variable expenses 355,000 235,000 120,000 Contribution margin 175,000 165,000 10,000 Fixed expenses 81,000 40,500 40,500 Operating income (loss) $94,000 $124,500 $(30,500