Contribution margin format income statement LO P2 Polarix is a retailer of ATVs (all-terrain vehicles) and accessories. An income statement for its Consumer ATV Department for the current year follows. ATVs sell for $3,800 each. Variable selling expenses are $270 per ATV. The remaining selling expenses are fixed. Administrative expenses are 40% variable and 60% fixed. The company does not manufacture its own ATVs; it purchases them from a supplier for $1,830 each. POLARIX Income Statement—Consumer ATV Department For Year Ended December 31 Sales $ 646,000 Cost of goods sold 311,100 Gross margin 334,900 Operating expenses Selling expenses $ 135,000 Administrative expenses 59,500 194,500 Net income $ 140,400