Carla Vista, Inc. reports the following operating results for August: Sales $531,000 (units 5,900); variable costs $318,600; and fixed costs $135,700. Management is considering the following independent courses of action to increase net income. 1. 2. 3. Increase the selling price by 10%. Reduce variable costs to 55% of sales. Reduce fixed costs by $24,000. Compute the net income to be earned under each alternative. 1. Increase selling price $ 2. Reduce variable costs $ 3. Reduce fixed costs Increase selling price $ mpute the net income to be earned under each alternative. Reduce variable costs Reduce fixed costs $ $ $ Net Income Net Income hich course of action will produce the highest net income? will produce higest net income.
Carla Vista, Inc. reports the following operating results for August: Sales $531,000 (units 5,900); variable costs $318,600; and fixed costs $135,700. Management is considering the following independent courses of action to increase net income. 1. 2. 3. Increase the selling price by 10%. Reduce variable costs to 55% of sales. Reduce fixed costs by $24,000. Compute the net income to be earned under each alternative. 1. Increase selling price $ 2. Reduce variable costs $ 3. Reduce fixed costs Increase selling price $ mpute the net income to be earned under each alternative. Reduce variable costs Reduce fixed costs $ $ $ Net Income Net Income hich course of action will produce the highest net income? will produce higest net income.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Please help me with show all calculation thanku
Transcribed Image Text:Carla Vista, Inc. reports the following operating results for August: Sales $531,000 (units 5,900); variable
costs $318,600; and fixed costs $135,700. Management is considering the following independent courses of
action to increase net income.
1.
2.
3.
Increase the selling price by 10%.
Reduce variable costs to 55% of sales.
Reduce fixed costs by $24,000.
Compute the net income to be earned under each alternative.
1. Increase selling price $
2. Reduce variable costs $
3. Reduce fixed costs
1. Increase selling price $
Compute the net income to be earned under each alternative.
2. Reduce variable costs
3. Reduce fixed costs
$
$
$
Net Income
Net Income
Which course of action will produce the highest net income?
will produce higest net income.
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