Santiego Corporation runs two convenience stores, one in Connecticut and one in Rhode Island. Operating income for each store in 2020 is as follows:

Data table

	Connecticut Store	Rhode Island Store
Revenues	$1,100,000	$850,000
Operating costs
Cost of goods sold	780,000	660,000
Lease rent (renewable each year)	86,000	76,000
Labor costs (paid on an hourly basis)	45,000	38,000
Depreciation of equipment	20,000	24,000
Utilities (electricity, heating)	43,000	54,000
Allocated corporate overhead	48,000	36,000
Total operating costs	1,022,000	888,000
Operating income (loss)	$78,000	$(38,000)

More info

The equipment has a zero disposal value. In a senior management meeting, Maria Lopez, the management accountant at Santiego Corporation, makes the following comment, "Santiego can increase its profitability by closing down the Rhode Island store or by adding another store like it."

Requirement 1. By closing down the Rhode Island store, Santiego can reduce overall corporate overhead costs by $43,000. Calculate Santiego'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 Santiego's operating income if it closes the Rhode Island store. (Complete all input fields. 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.)

	(Loss in Revenues)
	Savings in Costs
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	?
Effect on operating income (loss)	$?

Requirement 2. Calculate Santiego's operating income if it keeps the Rhode Island store open and opens another store with revenues and costs identical to the Rhode Island store (including a cost of $24,000 to acquire equipment with a 1-year useful life and zero disposal value). Opening this store will increase corporate overhead costs by $2,000. Is Maria Lopez's statement about the effect of adding another store like the Rhode Island store correct?

Begin by calculating Lopez's operating income if it keeps the Rhode Island store open and opens another store with revenues and costs identical to the Rhode Island store. (If the net effect is an operating loss, enter the amount with parentheses or a minus sign.)

	Incremental Revenues
	(Incremental Costs)
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	(?)
Effect on operating income (loss)	$(?)