Superior Markets, Inc., operates three stores in a large metropolitan area. A segmented absorption costing income statement for the company for the last quarter is given below: Superior Markets, Inc. Income Statement For the Quarter Ended September 30 North Store South Store East Store Total Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses: Administrative expenses Total expenses Net operating income (loss) $4,800,000 960,000 $1,920,000 $1,920,000 864,000 279,600 2,640,000 2,160,000 600,000 360,000 984,000 1,056,000 936,000 249,400 124,000 373,400 324,000 177,900 853,000 473,000 171.100 S 834,000 S(13,400 S 434,100 $ 413,300 The North Store has consistently shown losses over the past two years. For this reason, management is giving consideration to closing the store. The company has asked you to make a recommendation as to whether the store should be closed or kept open. The following additional information is available for your use a. The breakdown of the selling and administrative expenses is as follows North Store South Store Total Store Se ling expenses: Sales salaries Direct advertising General advertising Store rent Depreciation of store fixtures Delivery salaries Depreciation of delivery equipment Total selling expenses $ 246,200 59,000 $ 77,800 90,000 28,800 106,000 7,800 109,400 24,000 28,800 93,000 10,800 183,000 72,000 286,000 25,000 69,000 14,400 87,000 6,400 8,800 $ 853,000 $249,400 S324,000 $279,600 Allocated on the basis of sales dollars North Store South Store Total Store Administrative expenses Store management salaries General office salaries* Insurance on fixtures and inventory $ 97,000 30,000 S 39,000 28,000 28,800 72,000 43,000 74,760 66,240 120,000 12,900 25,870 16,830 28,800 18,000 20,940 27,950 26,250 48,000 171,100 t taxes General office-other* 48,000 $ 473,000 124,000 177,900 Total administrative expenses