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Bed & Bath, a retailing company, has two departments-Hardware and Linens. The company's most recent monthly contribution format income statement follows: Department Hardware Linens Tota

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Bed & Bath, a retailing company, has two departments-Hardware and Linens. The company's most recent monthly contribution format income statement follows: Department Hardware Linens Tota Sales Variable expenses Contribution margin Pixed expenses Net operating income (loss) $ 4,230,000 3,180,000 $1,050,000 402, 000 2,898,000 2,250,000 648,000 820, 000 1,332,000 930,000 2,160,000 1,340,000 $ 738,000 910,000 (172,000) A study indicates that $378,000 of the fixed expenses being charged to Linens are sunk costs or allocated costs that will continue even if the Linens Department is dropped. In addition, the elimination of the Linens Department will result in a 18% decrease in the sales of the Hardware Department Required: What is the financial advantage (disadvantage) of discontinuing the Linens Department? inancial (disadvantage)

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