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Superior Markets, Inc., operates three stores in a large metropolitan area. A segmented 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 Store South Store East Store Total Sales Cost of goods sold Gross margin Selling and administrative expenses: $4,900,000 $980,000 $1,960,000 $1,960,000 1,078,00o 882,000 2,695,00o 2,205,000 620,000 360,000 997,000 963,000 Selling expenses Administrative expenses 280,100 173,600 453,700 $ 872,000 $ (15,400) 459,100 428,300 855,000 250,400 125,000 375,400 324,500 179,400 503,900 478,000 1,333,000 Total expenses 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 that are shown above is as follows North Store South Store East Store Total Selling expenses: $252,600 184,000 73,500 278,000 25,500 26,700 14,700 65,400 $ 75,400 $111,800 Sales salaries Direct advertising General advertising* Store rent Depreciation of store fixtures Delivery salaries Depreciation of delivery 91,000 29,400 80,000 107,000 7,900 8,900 4,900 70,000 14,700 6,500 8,900 4,900 23,000 29,400 91,000 11,100 8,900 4,900 equipment Total selling expenses $855,000 $250,400 $324,500 $280,100 Allocated on the basis of sales dollars

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