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Bed Sr Bath, 6 retailing company. has two departmentsHardware and Linens. The company's most recent monthly contribution format income statement follows: Department Total Hardware Linens

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Bed Sr Bath, 6 retailing company. has two departmentsHardware and Linens. The company's most recent monthly contribution format income statement follows: Department Total Hardware Linens Sales $ 4,686,666 $ 3,646,666 $ 1,646,666 Variable expenses 1,313,666 916,666 463, 666 Contribution margin 2,767,666 2,136,666 637, 666 Fixed expenses 2,246,666 1,396,666 656, 666 Net operating income (loss) $ 527,689 $ 748,390 $ (213,838) A study indicates that $374,000 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? :S

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