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 Contribution margin Fixed expenses Net operating income (loss) 1,619,000 693,650 925,350 1,018,000 (92,650) $ 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: Sales Variable expenses as a percentage of sales Traceable fixed expenses East $399,000 55% $ 292,000 Division Central $620,000 31% $325,000 West $600,000 47% $203,000 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 $23,000 based on the belief that it would increase that division's sales by 18%. 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? Reg 1 Req 2A Req 2B Prepare a contribution format income statement segmented by divisions. Division Central West East $ 399,000 Sales Variable expenses Contribution margin Total Company $ 1,619,000 693,650 925,350 399,000 Traceable fixed expenses 925,350 $ 399,000 5 0 5 0 Divisional segment margin Common fixed expenses not traceable to divisions Net operating income 1$ 925,350 Reg 1 Reg 2A Reg 2B The Marketing Department has proposed increasing the West Division's monthly advertising by $23,000 based on the belief that it would increase that division's sales by 18%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented? (Do not round intermediate calculations.) Net operating income will Reg 1 Req 2B >