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:

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:

Required:

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 $19\%.$ 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?

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