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Cats Shop Here is a retailer in British Columbia. The most recent monthly income statement for Cats Shop Here is given below: Store A Store

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Cats Shop Here is a retailer in British Columbia. The most recent monthly income statement for Cats Shop Here is given below: Store A Store B Total Sales $1,450,000 $950,000 $2,400,000 Less variable expense 1.080.000 $420.000 1.500.000 Contribution margin $370,000 $530,000 $900,000 Less traceable fixed expense 231.000 189.000 420 000 Segment margin $141,000 $339,000 $480,000 Less common fixed expense 210.000 140 000 350.000 Operating Income $(69 000) $199.000 $130.000 Cats Shop Here is considering closing Store A. If Store A is closed, one-fourth of its traceable fixed expenses would continue to be incurred. Also, the closing of Store A would result in a 20% decrease in sales in Store B as loyal shoppers are expected to avoid the brand if Store A is closed. Cats Shop Here allocates common fixed expenses on the basis of sales dollars and none of these costs would be saved if a store were shut down. QUESTION 1 Should Cats Shop Here close Store A? (Show all calculations) (6 points)

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