Superior Markets, Inc., operates three stores in a large metropolitan area. Asegmented 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 South East Total Store Store Store $3,100,000 $700,000 $1,240,000 $1,160,000 Sales Cost of goods sold 1,705,000 380,000 687,000 638,000 Gross margin 1,395,000 320,000 553,000 522,000 Selling and administrative expenses: 315,500 Selling expenses: 819,000 232,400 271,100 152,400 Administrative expenses 388,000 107,000 128,600 Total expenses 1,207,000 339,400 467,900 399,700 188,000 (19,400) 85,100 122,300 Net operating income (loss) 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: Selling expenses: Sales salaries $240,400 69,000 86,600 84,800 180,000 52,000 73,000 55,000 Direct advertising 17,400 General advertising 46,500 10,500 18,600 305,000 86,000 121,000 98,000 Store rent Depreciation of store fixtures 16,500 700 6,100 5,700 21,300 Delivery salaries 7.100 7,100 7,100 Depreciation of delivery equipment 9,300 3,100 3,100 3,100 Total selling expenses $819,000 $232,400 $315,500 $271,100