Superior Markets, Incorporated, operates three stores in a large metropolitan area. A segmented absorption costing income statement for the company for the last quarter is given below: 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 that are shown above is as follows: b. The lease on the bulliting houring the North Store can be broken with no penalty. 6. The fixtures being used in the North Store would be transferred to the other two stores if the North Store were closed. d. The general manoger of the North Stote would be retained and transferred to another position in the company if the North Store were closed. She would be fiting a position that would otherwise be filled by hiring a new employee at a salary of $14.740 per quarter. The general manager of the North Store would continue to earn her normal salary of $16.080 per quartec. All other manageis and employees in the North store would be discharged. e. The company has one detivery crew that serves all three stores. One delivery person could be discharged if the North Store were closed. This person's salary is 55,360 per quartet. The delivery equipment would be distributed to the other stores. The equipment does not weat out through use, but does eventually become obsolete. 1. The company pays employment tawes equal to 15% of their employees' salaries. 9 One third of the inruarance in the North Store is on the store's foctures. h. The "General office salailes' and 'General office-other' relate to the overall management of Superior Markets. incorporated. If the North Store were closed, one person in the general office could be discharged because of the decrease in overall workload. This petson's compensation is $8.040 per quarter. Required: 1. How much employee salauks will the company avoid if it closes the North Store? 2. How much employment taxes will the company avoid it it closes the North Store? 3. What is the financial advantage (disadvantage) of closing the North Store? 4. Assuming that the North Store's floor space cant be subleased, would you recommend closing the North Store? 5 Assume that the North Slore's floor space can' be subleased. Howevet, fets introduce three more assumptions. First, assume that if the North Store were closed, one fourth of its sales would transfer to the East Store, due to strong customer loyally to Superior Makets. Second, assume that the East Store has enough capacity to handle the increased sales that would arise from closing the North Store. Third, assume that the increased sales in the East Store would yield the same gross margin as a percentage of sales as present sales in the East store. Given these new assumptions, what is the financial advantage (disadvantage) of closing the North Store? 1. How much employee salaries will the company avoid if it closes the North Store? 2. How much employment taxes will the company avoid if it closes the North Store? 3. What is the financial advantage (disadvantage) of closing the North Store? 4. Assuming that the North Store's floor space can't be subleased, would you recommend closing the North Store? 5. Assume that the North Store's floor space can't be subleased. However, let's introduce three more assumptions. First, assun the North Store were closed, one-fourth of its sales would transfer to the East Store, due to strong customer loyalty to Superio Markets. Second, assume that the East Store has enough capacity to handle the increased sales that would arise from closing North Store. Third, assume that the increased sales in the East Store would yield the same gross margin as a percentage of sal present sales in the East store. Given these new assumptions, what is the financial advantage (disadvantage) of closing the Nor Store? Complete this question by entering your answers in the tabs below. How much employee salaries will the company avoid if it closes the North Store? 1. How much employee salaries will the company avoid if it closes the North Store? 2. How much employment taxes will the company avoid if it closes the North Store? 3. What is the financial advantage (disadvantage) of closing the North Store? 4. Assuming that the North Store's floor space can't be subleased, would you recommend closing the North Store? 5. Assume that the North Store's floor space can't be subleased. However, let's introduce three more assumptions. First, assume that if the North Store were closed, one-fourth of its sales would transfer to the East Store, due to strong customer loyalty to Superior Markets. Second, assume that the East Store has enough capacity to handle the increased sales that would arise from closing the North Store. Third, assume that the increased sales in the East Store would yield the same gross margin as a percentage of sales as present sales in the East store. Given these new assumptions, what is the financial advantage (disadvantage) of closing the North Store? Complete this question by entering your answers in the tabs below. How much employment taxes will the company avoid if it closes the North Store? th Store Third ascume thet the iscrere nas enougn capacity to handle the increased sales that would aris esent sales in the East store. Given these new assumptions, what is the financial advantage (disadvantage) of esent saies in the East store. Given these new assumptions, what is the financial advantage (disadvantage) of ore? Complete this question by entering your answers in the tabs below. What is the financial advantage (disadvantage) of closing the North Store? (Enter any "disadvantages" as a negative val Complete this question by entering your answers in the tabs below. Assuming that the North Store's floor space can't be subleased, would you recommend closing the North stor Complete this question by entering your answers in the tabs below. Assume that the North Store's floor space can't be subleased. However, let's introduce three more assumptions. First, assume that if the North Store were closed, one-fourth of its sales would transfer to the East Store, due to strong customer loyalty to Superior Markets. Second, assume that the East Store has enough capacity to handle the increased sales that would arise from closing the North Store. Third, assume that the increased sales in the East Store would yield the same gross margin as a percentage of sales as present sales in the East store. Given these new assumptions, what is the financial advantage (disadvantage) of closing the North Store? (Enter any "disadvantages" as a negative value.)