9 Question ZrGroup4r Drop or x u Dashboard x l + V i X ( 2 C i ezto.mheducation.com/ext/map/index.hlml?,con:con&exlernal,browser:0&launchUrl:hilps%253/-\\%252F%252F|ms.mheducailon.com%252Fmghmlddleware%252theproducts%25... IE {I I] a Group 4 - Drop or Retain Segment/Close or Retain Store 0 Saved Help Save& Exit Submit w Superior Markets, Incorporated, operates three stores in a large metropolitan area. A segmented absorption costing income statement for the company for the last quarter is given below: 10 Superior Markets, Incorporated points Income Statement For the Quarter Ended September 39 Total North Store South Store East Store Sales $ 3,990,909 $ 720,909 $ 1,290,909 $ 1,980,909 Cost of goods sold 1,657,209 493,209 660,909 594,909 Pm,\" Gross margin 1,342,809 316,809 540,909 486,909 Selling and administrative expenses: Selling expenses 817,909 231,409 315,909 270,609 Administrative expenses 383,909 196,909 150,909 126,109 References Total expenses 1,290,909 337,409 465,909 396,709 Net operating income (loss) 3 142,809 3 (29,699) 3 74,166 3 89,309 The North Store has consistently shown losses over the past two years. For this reason, management is giving consideration to closing the store. The company has asked you to make a recommendation as to whether the store should be closed or kept open. The following additional information is available for your use: a. The breakdown ofthe selling and administrative expenses that are shown above is as follows: Total North Store South Store East Store Selling expenses: Sales salaries $ 239,999 3 79,999 $ 89,999 $ 89,999 Direct advertising 187,999 51,999 72,999 64,099 General advertising\" 45,999 19,899 18,999 16,299 Store rent 399,999 85,999 129,999 95,999 Depreciation of store Fixtures 16,999 4,699 6,999 5,499 Delivery salaries 21,999 7,999 7,999 7,999 Depreciation of delivery equipment 9,999 3,999 3,999 3,999 Total selling expenses 3 817,999 $ 231,499 $ 315,999 $ 279,699 \"Allocated on the basis of sales dollars. Total North Store South Store East Store Administrative expenses: Store managers' salaries $ 79,999 $ 21,999 $ 39,999 $ 19,099 General office salaries\" 59,999 12,999 29,999 18,999 Insurance on 'Fixtures and inventory 25,999 7,599 9,999 8,599 Utilities 196,999 31,999 49,999 35,999 V 26f2 %