Perez Corporation runs two convenience stores, one in Connecticut and one in Rhode Island. Operating income for each store in $2014$ is as follows:

$($Click to view the operating income for the stores.$)$

The equipment has a zero disposal value. In a senior management meeting, Maria Lopez, the management accountant at PerezCorporation, makes the following comment, "Perez can increase its profitability by closing down the Rhode Island store." Is Maria Lopez Correct?

Read the requirements.

Requirement $1.$ By closing down the Rhode Island store, Perez can reduce overall corporate overhead costs by $$50,000.$ Calculate Perez's operating income if it closes the Rhode Island store. Is Maria Lopez's statement about the effect of closing the Rhode Island store correct? Explain.

Begin by calculating Perez's operating income if it closes the Rhode Island store. $($Enter losses in revenues as a negative amount. Enter a $"0"$ if the cost is not relevant. If the net effect is an operating loss enter the amount with parentheses or a minus sign.$)$

$\backslash$table$[[$Revenues$,],[$Operating costs,$],[$Cost of goods sold,$],[$Lease rent $($renewable each year$),],[$Labor costs $($paid on an hourly basis$),],[$Depreciation of equipment,$],[$Utilities $($electricity$,$ heating$),],[$Corporate overhead,$],[$Total operating costs,$$