The most recent monthly income statement for Benner Stores is given below: Due to its poor showing, consideration is being given to closing Store B.Studies show that if Store B is closed, one-fourth of its traceable fixed expenses will continue unchanged.The studies also show that closing Store B would result in a 10 percent decrease in sales in Store A.The company allocates common fixed expenses to the stores on the basis of sales dollars.
Required:
Determine the monthly financial advantage (disadvantage)of closing Store B.

Question

The most recent monthly income statement for Benner Stores is given below:   Due to its poor showing, consideration is being given to closing Store B.Studies show that if Store B is closed, one-fourth of its traceable fixed expenses will continue unchanged.The studies also show that closing Store B would result in a 10 percent decrease in sales in Store A.The company allocates common fixed expenses to the stores on the basis of sales dollars.
Required:
Determine the monthly financial advantage (disadvantage)of closing Store B.

Quizplus · Accepted Answer

The Answer of The most recent monthly income statement for Benner Stores is given below:   Due to its poor showing, consideration is being given to closing Store B.Studies show that if Store B is closed, one-fourth of its traceable fixed expenses will continue unchanged.The studies also show that closing Store B would result in a 10 percent decrease in sales in Store A.The company allocates common fixed expenses to the stores on the basis of sales dollars.
Required:
Determine the monthly financial advantage (disadvantage)of closing Store B.

The Most Recent Monthly Income Statement for Benner Stores Is