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Compute the net income to be earned

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Question - Wilson Company reports the following operating results for the month of August: sales $300,000 (units 5,000); variable costs $212,200; and fixed costs $69,000.

Management is considering the following independent courses of action to increase net income.

Compute the net income to be earned under each alternative.

1. Increase selling price by 10% with no change in total variable costs or sales volume.

2. Reduce variable costs to 51% of sales.

3. Reduce fixed costs by $19,700.

Which course of action will produce the highest net income?

Reference no: EM132067059

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