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Chapter 12 1. PQR Company is a retail company with two departments - housewares and grocery. The company's most recent annual contribution format income statement follows: Department Total $1,000,000 300,000 700,000 400,000 $300,000 Housewares $250,000 150,000 100,000 110,000 (10,000) Groce $750,000 150,000 600,000 290,000 310,000 Sales Variable Expenses Contribution Margin Fixed Expens Net Operating Income (loss) $80,000 of the fixed expenses being charged to the Housewares are avoidable if the Housewares Department is dropped. In addition, the elimination of the Housewares department would result in a 5% decrease in the sales of the Grocery Department. What is the financial advantage (disadvantage) of discontinuing the Housewares Department? $-50,000