Reference no: EM132530024

O'Neill, Incorporated's segmented income statement for the most recent month is given below.

                                   Total Company                      Store A                        Store B

Sales                        $407,000                             $133,000               $274,000

Variable expenses              264,230                         97,090                       167,140

Contribution margin             142,770                       35,910                 106,860

Traceable fixed expenses      89,800                     31,600                    58,200

Segment margin                  52,970                     $4,310                 $48,660

Common fixed expenses      28,350

Net operating income       $24,620

For each of the following questions, refer back to the above original data.

Question 1: If Store B sales increase by $28,600 with no change in fixed expenses, the overall company net operating income should:

Option1 : increase by $3,289

Option2 : increase by $6,578

Option3 : increase by $11,154

Option4 : increase by $17,446