Sunland Company reports the following operating results for the month of August: sales $325,000 (units 5,000); variable costs $213,000; and fixed costs $71,600. Management is considering the following independent courses of action to increase net income. Compute the net income to be earned under each alternative. 1. Increase selling price by 10% with no change in total variable costs or sales volume. 2$ Net income 2. Reduce variable costs to 58% of sales. 2$ Net income 3. Reduce fixed costs by $24,000. $enter a net income if the fixed costs are reduced by $24,000 Net income

Sunland Company reports the following operating results for the month of August: sales $325,000 (units 5,000); variable costs $213,000; and fixed costs $71,600. Management is considering the following independent courses of action to increase net income. Compute the net income to be earned under each alternative. 1. Increase selling price by 10% with no change in total variable costs or sales volume. 2$ Net income 2. Reduce variable costs to 58% of sales. 2$ Net income 3. Reduce fixed costs by $24,000. $enter a net income if the fixed costs are reduced by $24,000 Net income

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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