QUESTION 13 20 points Save Answer Second Time Around sells clothing, shoes, and accessories at a location near Geraldton. Information for the just concluded calendar year follows. Sales Less: Variable costs Fixed costs Total costs Operating income (loss) Clothing $850,000 $510,000 290,000 $800,000 $50,000 Shoes $320,000 $270,000 70,000 $340,000 -$20,000 Accessories $150,000 $82,500 42.000 $ 124,500 $25,500 Management is considering closing the shoe operation because of the loss and expanding the space that is currently devoted to accessories sales. A salaried salesperson in the shoe department who earns $45,000 will be terminated; however, all other departmental fixed costs will continue to be incurred. Second Time Around will spend $16,000 on remodeling costs and anticipates that accessories sales will increase by $70,000. This additional sales revenue is expected to generate a 35% contribution margin for the firm. Finally, because clothing customers often purchased shoes and feel strongly about "one-stop shopping," clothing sales are expected to fall by 15% if the shoe department is closed. Required: Determine whether the shoe department should be closed. (20 marks)