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Compare the total net income

$($

loss

$)$

$$when the two stores are open with the total net operating income

$($

loss

$)$

$$when only Store

$2$

$$is open. Is the total net operating income greater

$($

total net operating loss smaller

$)$

$$when two stores are open or when only Store

$2$

$$Atlas Corp. is a little two

$-$

store retailer operating in a local market. Its problem is that one store in the company is losing money while the other one is making money, based on company financial reports, causing the company as a whole to lose money. The most recent income statement for Gopher Gulch Corp. is given below:

$$ Store

$1$

$$ Store

$2$

$$ Total

Sales $

$9$

$7$

$6$

$,$

$0$

$0$

$0$

$$ $

$1$

$,$

$1$

$4$

$5$

$,$

$0$

$0$

$0$

$$ $

$2$

$,$

$1$

$2$

$1$

$,$

$0$

$0$

$0$

Variable costs

$($

$5$

$9$

$3$

$,$

$0$

$0$

$0$

$)$

$($

$6$

$8$

$5$

$,$

$0$

$0$

$0$

$)$

$($

$1$

$,$

$2$

$7$

$8$

$,$

$0$

$0$

$0$

$)$

Contribution margin

$3$

$8$

$3$

$,$

$0$

$0$

$0$

$4$

$6$

$0$

$,$

$0$

$0$

$0$

$8$

$4$

$3$

$,$

$0$

$0$

$0$

Traceable fixed costs

$($

$4$

$7$

$0$

$,$

$0$

$0$

$0$

$)$

$($

$2$

$6$

$9$

$,$

$0$

$0$

$0$

$)$

$($

$7$

$3$

$9$

$,$

$0$

$0$

$0$

$)$

Store segment margin

$($

$8$

$7$

$,$

$0$

$0$

$0$

$)$

$1$

$9$

$1$

$,$

$0$

$0$

$0$

$1$

$0$

$4$

$,$

$0$

$0$

$0$

Common fixed costs

$($

$1$

$1$

$6$

$,$

$0$

$0$

$0$

$)$

$($

$8$

$5$

$,$

$0$

$0$

$0$

$)$

$($

$2$

$0$

$1$

$,$

$0$

$0$

$0$

$)$

Net operating income

$($

loss

$)$

$$ $

$($

$2$

$0$

$3$

$,$

$0$

$0$

$0$

$)$

$$ $

$1$

$0$

$6$

$,$

$0$

$0$

$0$

$$ $

$($

$9$

$7$

$,$

$0$

$0$

$0$

$)$

is open?

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