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The best course of action is? 1-increase selling price 2-reducing variable cost 3-reducing fixed cost Additional Exercise 174 Henderson Farms reports the following results for
The best course of action is?
1-increase selling price
2-reducing variable cost
3-reducing fixed cost
Additional Exercise 174 Henderson Farms reports the following results for the month of November: Sales (10,000 units) Variable costs Contribution margin Fixed costs Net income $600,000 420,000 180,000 110,000 $ 70,000 Management is considering the following independent courses of action to increase net income. 1. Increase selling price by 5% with no change in total variable costs. 2. Reduce variable costs to 66 ?/:% of sales. 3. Reduce fixed costs by $10,000. Calculate net income for the above courses of action. Net Income Course 1. Increase selling price $ 2. Reduce variable cost $ 3. Reduce fixed cost $ If maximizing net income is the objective, which is the best course of action? Best course of action is
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