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1 pts Question 6 VERSION C (suggested time 20 minutes) Mercury Incorporated has two stores. The most recent monthly income statement for Mercury Incorporated is

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1 pts Question 6 VERSION C (suggested time 20 minutes) Mercury Incorporated has two stores. The most recent monthly income statement for Mercury Incorporated is given below: Total Alpha Store Beta Store Sales $2,100,000 $1,300,000 $ 800,000 Less variable expenses 1.250.000 882.000 378,000 Contribution margin 840 000 418,000 422.000 Less traceable fixed expenses 420.000 231.000 189.000 Segment margin 420,000 187,000 233,000 Less common fixed expenses 350.000 210.000 140.000 Net Income S 70.000 S. (23.000) 93.000 Mercury is considering closing Alpha Store. If Alpha Store is closed one-fourth of its traceable fixed expenses would continue to be incurred. Also, the closing of Alpha Store would result in a 10% decrease in the sales volume in Beta Store The variable cost behavior would remain the same. Mercury allocates common fixed expenses based on sales dollars and none of these costs would be saved if a store were shut down What would the overall net income of Mercury be if Alpha Store was closed? Should Alpha Store be closed (type yes or no)? Refer to the original information presented and ignore the consideration of closing Alpha Store. Measure the impact on overall net income for the company if Beta Store initiates an advertising campaign costing $120,000, which is expected to increase Beta Store's sales volume by 29%. Should the company run the campaign (type Yes or No)? What would be the impact on net income? arch o

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