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Pharoah, Inc. reports the following operating results for August: Sales $464,000 (units 5,800); variable costs $278,400; and fixed costs $104,400. Management is considering the following
Pharoah, Inc. reports the following operating results for August: Sales $464,000 (units 5,800); variable costs $278,400; and fixed costs $104,400. Management is considering the following independent courses of action to increase net income. 1. Increase the selling price by 10%. 2. Reduce variable costs to 55% of sales. 3. Reduce fixed costs by $23,000. Compute the net income to be earned under each alternative. Which course of action will produce the highest net income? . will produce higest net income
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