2-A2 Exercises in Cost-Volume-Profit Relationships The MacKenzie-Hawkins Transportation Company specializes in hauling heavy goods over long distances. The company's revenues and expenses depend on revenue miles, a measure that combines both weights and mileage. Summarized budget data for next year are based on predicted total revenue miles of 800,000. Per Revenue Mile quired Average selling price (revenue) Average variable expenses Fixed expenses, $110,000 $1.50 1.30 1. Compute the budgeted net income, Ignore income taxes. 2. Management is trying to decide how various possible conditions or decisions might affect net income. Compute the new net income for each of the following changes. Consider each case independently. a. A 10% increase in revenue miles b. A 10% increase in sales price c. A 10% increase in variable expenses d. A 10% increase in fixed expenses e. An average decrease in selling price of 3 per mile and a 5% increase in revenue miles. Refer to the original data f. An average increase in selling price of 5% and a 10% decrease in revenue miles g. A 10% increase in fixed expenses in the form of more advertising and a 5% increase in revenue miles