Closing the Town Store would result in 35% of its traceable fixed continuing and a 20% increase in Mall Store sales and variable costs. Use the following data to determine the increase (decrease) in Cosmo's operating income if the Town store is closed.MallStore$140,00090,000$ 50,00028,000$ 22,0007.000$ 15,000TownSales.Less variable costs..Contribution margin .Less traceable fixed expenses..Store segment margin..Less common fixed expenses..Operating income..Total$ 260,000174,000$ 86,00060,000$26,00012,000$14,000Store$120,00084,000$ 36,00032,000$ 4,0005,000$( 1,000)O A. S 1,000.O B. $ (5,200).O C.$ (14,800).O D. $ (15,200).O E. $ (24,800).

GIVEN THAT, 1) 35% of the traceable fixed cost will be continuing. = $32000 * 35% = $11200 total…

Closing the Town Store would result in 35% of its traceable fixed continuing and a 20% increase in Mall Store sales and variable costs. Use the following data to determine the increase (decrease) in Cosmo's operating income if the Town store is closed. Mall store $140,000 90,000 5 50,000 28,000 $ 22,000 Z.000 $ 15,000 Town Sales. Less variable costs. Contribution margin ... Less traceable fixed expenses.. Store segment margin.. Less common fixed expenses. Operating income. Total $ 260,000 174,000 $ 86,000 60.000 ..$ 26,000 12.000 $14,000 Store $120,000 84,000 $ 36,000 32,000 $ 4,000 5,000 $ 1,000) OAS 1,000. O B.S (5,200). OCS (14,800). O D. S (15,200). OE S (24,800).

Closing the Town Store would result in 35% of its traceable fixed continuing and a 20% increase in Mall Store sales and variable costs. Use the following data to determine the increase (decrease) in Cosmo's operating income if the Town store is closed. Mall store $140,000 90,000 5 50,000 28,000 $ 22,000 Z.000 $ 15,000 Town Sales. Less variable costs. Contribution margin ... Less traceable fixed expenses.. Store segment margin.. Less common fixed expenses. Operating income. Total $ 260,000 174,000 $ 86,000 60.000 ..$ 26,000 12.000 $14,000 Store $120,000 84,000 $ 36,000 32,000 $ 4,000 5,000 $ 1,000) OAS 1,000. O B.S (5,200). OCS (14,800). O D. S (15,200). OE S (24,800).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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