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Store 1 Store 2 Company Sales $400,000 $600,000 $1,000,000 Variable expenses 160,000 420,000 580,000 Contribution margin 240,000 180,000 420,000 Traceable fixed expenses 100,000 200,000 300.000

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Store 1 Store 2 Company Sales $400,000 $600,000 $1,000,000 Variable expenses 160,000 420,000 580,000 Contribution margin 240,000 180,000 420,000 Traceable fixed expenses 100,000 200,000 300.000 Segment margin 140,000 (20,000) 120,000 30,000 Common fixed expenses 20,000 Net operating income $120,000 50,000 $70,000 ($50,000 The company is thinking about closing Store 2. If it is closed, 1/4 of its traceable fixed expenses will continue, and Store 1 will have a 10% decrease in sales. What is the financial advantage (disadvantage) of closing Store 2? Show your work

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