Whitney Company has just completed its first year of operations. The company's accountant has prepared an absorption costing income statement for the year as seen below: Sales (35,000 units at $25) $875,000 Beginning Inventory 0 Cost of Goods Manufactured (35,000 × $12) + $160,000 = 580,000 Cost of Goods Available 580,000 Ending Inventory 0 Cost of Goods Sold 580,000 Gross Margin 295,000 Selling and Administrative Expenses 280,000 Net Income $15,000 The variable production costs per unit are determined as follows: Direct materials $ 5 Direct labor 6 Variable production 1 Total variable production costs $12 The company's fixed production costs are $160,000 per year. The company's selling and administrative expenses consist of $210,000 per year in fixed expenses and $2 per unit in variable expenses.
Prepare the company's income statement in the contribution format.