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Superior Markets, Inc. operates three stores in a 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
	Total			North Store			South Store			East Store
Sales	$	3,100,000		$	1,200,000		$	600,000		$	1,300,000
Cost of goods sold		1,589,000			540,000			360,000			569,000
Gross margin		1,511,000			660,000			240,000			731,000
Selling and administrative expenses:
Selling expenses		601,600			196,132			177,316			228,152
Administrative expenses		295,900			102,222			81,261			112,417
Total expenses		897,500			298,354			258,577			340,569
Net operating income (loss)	$	613,500		$	(241,646	)	$	18,577		$	390,431

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 is as follows:

	Total		North Store		South Store		East Store
Selling expenses:
Sales salaries	$	154,000	$	49,000	$	42,000	$	63,000
Direct advertising		116,900		34,000		40,000		42,900
General advertising*		13,000		5,032		2,516		5,452
Store rent		205,000		68,000		62,000		75,000
Depreciation of store fixtures		46,700		18,100		8,800		19,800
Delivery salaries		42,000		14,000		14,000		14,000
Depreciation of delivery equipment		24,000		8,000		8,000		8,000
Total selling expenses	$	601,600	$	196,132	$	177,316	$	228,152

*Allocated on the basis of sales dollars.

	Total		North Store		South Store		East Store
Administrative expenses:
Store management salaries	$	68,000	$	24,000	$	15,000	$	29,000
General office salaries*		46,000		17,806		8,903		19,291
Insurance on fixtures and inventory		23,400		7,300		8,300		7,800
Utilities		98,600		33,000		32,000		33,600
Employment taxes		37,900		11,600		12,800		13,500
General officeother*		22,000		8,516		4,258		9,226
Total administrative expenses	$	295,900	$	102,222	$	81,261	$	112,417

*Allocated on the basis of sales dollars.

b.	The lease on the building housing the North Store can be broken with no penalty.
c.	The fixtures being used in the North Store would be transferred to the other two stores if the North Store were closed.
d.	The general manager of the North Store would be retained and transferred to another position in the company if the North Store were closed. She would be filling a position that would otherwise be filled by hiring a new employee at a salary of $12,000 per quarter. The general manager of the North Store would be retained at her normal salary of $15,000 per quarter. All other employees in the store would be discharged.
e.	The company has one delivery crew that serves all three stores. One delivery person could be discharged if the North Store were closed. This persons salary is $5,000 per quarter. The delivery equipment would be distributed to the other stores. The equipment does not wear out through use, but does eventually become obsolete.
f.	The companys employment taxes are 12% of salaries.
g.	One-third of the insurance in the North Store is on the stores fixtures.
h.	The General office salaries and General officeother relate to the overall management of Superior Markets, Inc. If the North Store were closed, one person in the general office could be discharged because of the decrease in overall workload. This persons compensation is $7,500 per quarter.

Required:
1.	Prepare a schedule showing the change in revenues and expenses and the impact on the companys overall net operating income that would result if the North Store were closed. (Any losses/ reductions should be indicated by a minus sign.)

I have most of this---what I need to know is the store management salaries and the employment taxes thats it.

Gross margin lost if the store is closed		$(660,000)
Costs that can be avoided:
Store rent	$68,000
Sales salaries	49,000
Delivery salaries	5,000
Insurance on inventories	4,867
Employment taxes
Direct advertising	34,000
Utilities	33,000
Store management salaries
General office compensation	7,500
Salary of new manager	12,000
		228,367
Decrease in company profits if the North Store is closed		$(431,633)

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