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Cullumber Company reports the following operating results for the month of August: sales $382,500 (units...

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Accounting

Cullumber Company reports the following operating results for the month of August: sales $382,500 (units 5,100), variable costs $247,000, and fixed costs $96,000. Management is considering the following independent courses of action to increase net income.

1. Increase selling price by 12% with no change in total variable costs or units sold.
2. Reduce variable costs to 57% of sales.

Compute the net income to be earned under each alternative.

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