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Attempts: 1 of 5 used (b) Birchfield's management is looking at longer term solutions to improve net income. One of the options they have
Attempts: 1 of 5 used (b) Birchfield's management is looking at longer term solutions to improve net income. One of the options they have reviewed will increase fixed expenses by $26,000 while reducing variable expenses by $2.00 per unit. Management feels that with these changes the price of the product could be reduced by $1.00 per unit. The decrease in price will then result in an increase in unit sales of 5%. Compute the net income to be earned under this alternative. Do you recommend this option? Why or why not? (Round per unit calculations to 2 decimal places, e.s. 15.25 and final answers to O decimal places, eg. 125.) Net Income $ This option is as it net income.
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