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Shown as follows is a segmented income statement for Drexel-Hall during the current month. 00% 62 38% 55 Store 1 Dollars $ 600,000 372,000 $ 228,000 120,000 $ 108,000 48,000 $ 60,000 Drexel-Hall Dollars $1,800,000 100% 1,080,000 $ 720,000 432,000 $ 288,000 180,000 $ 108,000 36,000 $ 72,000 Sales Variable costs Contribution margin Traceable fixed costs: controllable Performance margin Traceable fixed costs: committed Store responsibility margin Common fixed costs Income from operations Profit Centers Store 2 Dollars $ 600,000 100% 378,000 $222,000 102,000 $ 120,000 20% 66,000 $ 54,000 9% 20 Store 3 Dollars $600,000 100 % 330,000 $ 270,000 45 % 210,000 35 $ 60,000 10 66,000 $ (6,000) 18% 11 10% All stores are similar in size, carry similar products, and operate in similar neighborhoods. Store 1 was established first and was built at a lower cost than were Stores 2 and 3. This lower cost results in less depreciation expense for Store 1. Store 2 follows a policy of minimizing both costs and sales prices. Store 3 follows a policy of providing extensive customer service and charges slightly higher prices than the other two stores. Top management of Drexel-Hall is considering closing Store 3. The three stores are close enough together that management estimates closing Store 3 would cause sales at Store 1 to increase by $87,000, and sales at Store 2 to increase by $144,000. Closing Store 3 is not expected to cause any change in common fixed costs. Compute the increase or decrease that closing Store 3 should cause in: a. Total monthly sales for Drexel-Hall stores. b. The monthly responsibility margin of Stores 1 and 2. c. The company's monthly income from operations. Required A Required B Required C Total monthly sales for Drexel-Hall stores. Net increase expected in total monthly sales Required A Required B Required C The monthly responsibility margin of Stores 1 and 2. Monthly Responsibility Margin Store 1 Store 2 Required A Required B Required C The company's monthly income from operations. Expected in monthly operating income