Sales Less variable expense Contribution margin Less traceable fixed expense Segment margin Less common fixed expense Operating Income Total Store Store II $2,100,000 $1,300,000 $800,000 1,260,000 $882.900 378.000 $840,000 $418,000 $422,000 420,000 231,000 189,900 $420,000 $187,000 $233,000 350.000 21 , 140,000 $70,000 $23,000 $93,00 Famous Stores are considering closing Store I. I Store I is closed, one fourth of its traceable fixed expenses would continue to be incurred Also, the closing of Store I would result in a 20% decrease in sales in Store It. Famous Stores allocates common fixed expenses on the basis of sales dollars and none of these costs would be saved If a store were shut down. Required: a) Compute the overall increase or decrease in the operating income of Northern Stores if Store I is closed. (5 marks) - Provide a qualitative analysis for closing the store (a minimum of 2 pros 2 cons). Based on your quantified and qualified analysis should Chey close the store