Lily Company reports the following operating results for the month of February: sales $984,000 (units 16,400 ); variable costs $467,400; and fixed costs $195,000. Management is considering the following independent courses of action to increase net income. 1. Increase selling price by 2.7% with no change in total variable costs or units sold. 2. Reduce variable costs to 43.90% of sales. (a) Compute the net income to be earned under each alternative. (Round per unit calculations to 2 decimal places, e.g. 15.25 and final answers to 0 decimal places, e.g. 125.) Which course of action will produce the highest net income? will produce the highest net income