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1. By closing down the Rhode Island store, Perez can reduce overall corporate overhead costs by $47,000. Calculate Perez's operating income if it closes the
1. By closing down the Rhode Island store, Perez can reduce overall corporate overhead costs by $47,000. Calculate Perez's operating income if it closes the Rhode Island store. Is Maria Lopez's statement about the effect of closing the Rhode Island store correct? Explain. 2. Calculate Perez's operating income if it keeps the Rhode Island store open and opens another store with revenues and costs identical to the Rhode Island store (including a cost of $24,000 to acquire equipment with a 1-year useful life and zero disposal value). Opening this store will increase corporate overhead costs by $7,000. Is Maria Lopez's statement about the effect of adding another store like the Rhode Island store correct? Explain. More info The equipment has a zero disposal value. In a senior management meeting, Maria Lopez, the management accountant at Perez Corporation, makes the following comment, "Perez can increase its profitability by closing down the Rhode Island store or by adding another store like it." Data table Perez Corporation runs two convenience stores, one in Connecticut and one in Rhode Island. Operating income for each store in 2020 is as follows: (Click to view the operating income for the stores.) (Click the icon to view the add-or-drop segments information.) Read the requirements. Requirement 1. By closing down the Rhode Island store, Perez can reduce overall corporate overhead costs by $47,000. Calculate Perez's operating income if it closes the Rhode Island store. Is Maria Lopez's statement about the effect of closing the Rhode Island store correct? Explain. Begin by calculating Perez's operating income if it closes the Rhode Island store. (Complete all input fields. Enter losses in revenues as a negative amount. Enter a "0" if the cost is not relevant. If the net effect is an operating loss enter the amount with parentheses or a minus sign.)
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