Question
Swifty Company reports the following operating results for the month of August: sales $315,000 (units 5,000); variable costs $218,000; and fixed costs $70,000. Management is
Swifty Company reports the following operating results for the month of August: sales $315,000 (units 5,000); variable costs $218,000; and fixed costs $70,000. Management is considering the following independent courses of action to increase net income. Compute the net income to be earned under each alternative.
1. Increase selling price by 10% with no change in total variable costs or sales volume. enter a net income if the selling price is increased by 10%
2. Reduce variable costs to 60% of sales. enter a net income if the variable costs are reduced to 60% of sales
3. Reduce fixed costs by $23,000. enter a net income if the fixed costs are reduced by $23,000
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