Irving Corporation runs two stores, one in Medfield and one in Oakland. Operating income for each store in 2017 is as follows:

The equipment has zero disposal value.

Required 

1. By closing down the Oakland store, Irving can reduce overall corporate overhead costs by \($85,000.\) Should Irving Corporation close down the Oakland store?

2. Instead of closing down the Oakland store, Irving Corporation is thinking of opening another store with revenues and costs identical to the Oakland store (including a cost of \($40,000\) to acquire equipment with a one-year useful life and zero disposal value). Opening this store will increase corporate overhead costs by \($10,000.\) Should Irving Corporation open another store like the Oakland store? Explain.

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Medfield Store Oakland Store Revenues $2,100,000 $1,700,000 Operating costs Cost of goods sold 1,500,000 1,310,000 Variable operating costs (labor, utilities) 180,000 170,000 Lease rent (renewable each year) 160,000 155,000 Depreciation of equipment 50,000 40,000 Allocated corporate overhead 90,000 75,000 Total operating costs 1,980,000 1,750,000 Operating income (loss) $ 120,000 $ (50,000)