Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales Variable expenses $ 1,587,000 584,760 1,002,240 1,102,000 Contribution margin Fixed expenses Net operating income (loss) $ (99,760) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Division Central $ 600,000 28% Sales East $ 417,000 West $570,000 38% Variable expenses as a percentage of sales Traceable fixed expenses $ 252,000 $ 340,000 $ 196,000 Required: 1. Prepare a contribution format income statement segmented by divisions 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $25,000 based on the belief that it would increase that division's sales by 13%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented? 2-b. Would you recommend the increased advertising? 48%