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2 E11-30 (similar to) i Requirements i (Click the icon Nunez Corporation runs two convenience stores, one in Connecticut and one in Rhode Island, Operating
2 E11-30 (similar to) i Requirements i (Click the icon Nunez Corporation runs two convenience stores, one in Connecticut and one in Rhode Island, Operating income for each store in 2017 is as follows: (Click to view the operating income for the stores.) Read the required Requirement 1. By closing down the Rhode Island store, Nunez can reduce overall corporate overhead costs by $50,000. Calculate Nunez's closing the Rhode Island store correct? Explain. Begin by calculating Nunez's operating income if it closes the Rhode Island store. (Complete all answer boxes. Enter losses in revenues as a amount with parentheses or a minus sign.) 1. By closing down the Rhode Island store, Nunez can reduce overall corporate overhead costs by $50,000. Calculate Nunez'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 Nunez'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 $26,000 to acquire equipment with a one-year useful life and zero disposal value). Opening this store will increase corporale overhead costs by $5,000. Is Maria Lopez's statement about the effect of adding another store like the Rhode Island store correct? Explain. (Loss in Revenues) Savings in Costs Data Table Revenues Operating costs Print Done Connecticut ROUE SITT Store Store $ S 1,110.000 $ 810,000 Cost of goods sold Lease rent (renewable each year) Labor costs (paid on an hourly basis) Depreciation of equipment Utilities (electricity, heating) Corporate overhead Total operating costs Revenues Operating costs Cost of goods sold Lease rent (renewable each year) Labor costs (paid on an hourly basis) 720,000 92.000 600,000 76,000 44,000 24,000 47,000 26,000 Effect on operating income (oss) Depreciation of equipment Utilities (electricity, heating) 41,000 51,000 43,000 43,000 Enter any number in the edit fields and then click Check Answer. Allocated corporate overhead ? Tatalanarinacote 972,000 835,000
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