1: Rashed and Salem operates two stores, one in Manama and the other one in Muharraq. Results for the month of May, which is representative of all months, are as follows: Manama Store Sales revenue $ 80,000 Variable costs 32,000 Contribution Margin 48,000 Direct Fixed costs 20,000 Common fixed costs 4,000 Operating income $24,000 Muhrraq Store $ 120,000 84,000 36,000 40,000 6,000 $ (10,000) Additional information. One-fourth of each store's direct fixed expenses would continue if either store were closed. The accountant allocates common fixed expenses to each store on the basis of sales dollars. Management estimates that closing the Muharraq store would result in a 10% decrease in the Manam's store's sales, while closing the Manam's store would have no effect on the Muharraq store's sales Required: a. The management believes that the Muharraq store should be closed, since it is operating at a loss. Do you support management's belief? Why or why not? Show you analysis b- Should management consider closing Manama's store rather than the Muharraq's store? Why or why not? Show you analysis c- The owners are considering a special promotional campaign at the Muharraq store. They expect a $6,000 monthly increase in advertising expenses to generate a 10% increase in the store's sales volume. The campaign would not affect sales at the Manama store. What effect would the promotion have on the company's monthly income? Should the campaign be implemented? Why or why not? Ignore your answers to parts (a) and (b). [6 Marks]