E6-3 Barnes Company reports the following operating results for the month of August: sales Compute net income under different alternatives (units 5,000): variable costs $210,000; and fixed costs $75,000. M $325,000 independent courses of action to increase net income. anagement is considering the following Increase selling price by 10% with no change in total variable costs or sales volume. Reduce variable costs to 58% of sales 2 3 Instructions Compute the net income to be earned under each alternative. Which Reduce fixed costs by $15,000. course of action will produce the highest net income? mber in cells requesting a value; enter either a number or a formula in cells with a"?" Increase selling price by 10% with no change in total variable costs or sales volume. 2 Current selling price New selling price Round to nearest cent) Total sales Less: variable costs Contribution margin Less: fixed costs Net income Value Reduce variable costs to 58% of sales Total Sales Less: variable costs Contribution margin Less: fixed costs 2. Value Value Value Net income Reduce fixed costs by $15,000 Total Sales Less: variable costs Contribution margin Less: fixed costs Net income 3 Value Value Value After you have completed E6-3, consider the following additional questions. ssume that unit selling price increased 5% with no change in total variable costs or sales volume. Assume variable costs decreased to 53% of sales Assume that fixed costs increased by $20,000. Which course of action will produce the highest net income