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Vaughn's management is looking at longer term solutions to improve net income. One of the options it has reviewed will increase fixed expenses by $29,000

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Vaughn's management is looking at longer term solutions to improve net income. One of the options it has reviewed will increase fixed expenses by $29,000 while reducing variable expenses by $2.00 per unit. Management feels that with these changes, the price of the product could be reduced by $1.00 per unit. The decrease in price will then result in an increase in unit. sales of 5%. Compute the net income to be earned under this alternative. Do you recommend this option? Why or why not? (Round per unit calculations to 2 decimal places, eg. 15.25 and final answers to 0 decimal places, es. 125.) Vaughn's management is looking at longer term solutions to improve net income. One of the options it has reviewed will increase fixed expenses by $29,000 while reducing variable expenses by $2.00 per unit. Management feels that with these changes, the price of the product could be reduced by $1.00 per unit. The decrease in price will then result in an increase in unit. sales of 5%. Compute the net income to be earned under this alternative. Do you recommend this option? Why or why not? (Round per unit calculations to 2 decimal places, eg. 15.25 and final answers to 0 decimal places, es. 125.)

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