You run a business with three branches. Here are the branches' performance figures. Admiral Commander Ensign Revenue 40,000 110,000 68,000 Variable costs 54,000 23,000 60,000 Fixed costs Property tax 10,000 10,000 10,000 Marketing 5,000 5,000 5,000 Depreciation 17,000 3,000 13,000 Total costs 86,000 88,000 41,000 (1,000) (20,000) Net income 24,000 Property tax and marketing are split evenly across the three branches and cannot be avoided if a branch is closed. All other costs and revenues are avoidable if a branch is closed. 1 Should we close Ensign? Should we close Commander? 2