Select the incorrect statement regarding the contribution margin income statement.

a. the contribution margin approach for the income statement is unacceptable for external reporting.
b. contribution margin represents the amount available to cover product costs and thereafter to provide profit.
c. the contribution margin approach requires that all costs be classified as fixed or variable.
d. assuming no change in fixed costs, a $1 increase in contribution margin will result in a $1 increase in profit.

James jones is the owner of a small retail business operated as a sole proprietorship. during 2017, his business recorded the following items of income and expense: revenue from inventory sales $ 147,000 cost of goods sold 33,500 business license tax 2,400 rent on retail space 42,000 supplies 15,000 wages paid to employees 22,000 payroll taxes 1,700 utilities 3,600 compute taxable income attributable to the sole proprietorship by completing schedule c to be included in james’s 2017 form 1040. compute self-employment tax payable on the earnings of james’s sole proprietorship by completing a 2017 schedule se, form 1040. assume your answers to parts a and b are the same for 2018. further assume that james's business is not a service business, and that it has $155,000 unadjusted basis in tangible depreciable property. calculate james's 2018 section 199a deduction.