All employees except the store manager would be discharged

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Reference no: EM131539142

Papa Fred's Pizza store no. 16 has fallen on hard times and is about to be closed. The following figures are available for the period just ended:

All employees except the store manager would be discharged. The manager, who earns $27,000 annually, would be transferred to store no. 19 in a neighboring suburb. Also, no. 16's furnishings and equipment are fully depreciated and would be removed and transported to Papa Fred's warehouse at a cost of $2,800.

Required:

A. What is store no. 16's reported loss for the period just ended?

B. Should the store be closed? Why?

C. Would Papa Fred's likely lose all $205,000 of sales revenue if store no. 16 were closed? Explain.

D. What are sold some of the considerations an owner or CEO should consider before closing a store, department or any business segments?

Reference no: EM131539142

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