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Lux Company operates two stores with the following information. Store A Store B Total Sales revenue 150,000 90,000 240,000 Variable Costs 90,000 54,000 144,000 Fixed
Lux Company operates two stores with the following information.
Store A | Store B | Total | ||||
Sales revenue | 150,000 | 90,000 | 240,000 | |||
Variable Costs | 90,000 | 54,000 | 144,000 | |||
Fixed Costs (Allocated) | 40,000 | 40,000 | 80,000 | |||
Income (Loss) | 20,000 | (4,000) | 16,000 |
Assume all fixed costs are unavoidable. If Store B is closed sales at Store A will increase by $50,000. What is the increase or decrease in the company's net income if Store B is closed? Do not enter $ signs or commas. If it is a decrease use a negative sign. For example, enter a $10,000 increase as 10000. Enter a $10,000 decrease as a -10000:
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