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: Gross margin Superior Markets, Incorporated Income Statement For the Quarter Ended September 30 Sales Cost of goods sold Selling and administrative expenses: Selling expenses Administrative expenses Total expenses Net operating income (loss) Total $ 3,780,000 2,088,072 1,691,928 North Store South Store $ 907,200 508,032 $ 1,512,000 831,600 East Store $ 1,360,800 748,440 399,168 680,400 612,360 291,564 396,900 340,956 133,560 190,134 158,886 425,124 587,034 499,842 $ 179,928 $ (25,956) $ 93,366 $ 112,518 1,029,420 482,580 1,512,000 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: Selling expenses: Sales salaries Direct advertising General advertising* Store rent Depreciation of store fixtures Delivery salaries Depreciation of delivery equipment Total selling expenses *Allocated on the basis of sales dollars. Administrative expenses: Total North Store South Store East Store $ 301,140 235,620 56,700 378,000 $ 88,200 64,260 13,608 $ 112,140 90,720 $ 100,800 80,640 22,680 20,412 107,100 151,200 119,700 20,160 5,796 7,560 6,804 26,460 8,820 8,820 8,820 11,340 3,780 3,780 3,780 $ 1,029,420 $ 291,564 $ 396,900 $ 340,956 Total North Store South Store East Store