Henderson Farms reports the following results for the month of November:
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.
Instructions
If maximizing net income is the objective, which is the best course of action?

Question

Henderson Farms reports the following results for the month of November:  
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.
Instructions
If maximizing net income is the objective, which is the best course of action?

Quizplus · Accepted Answer

The Answer of Henderson Farms reports the following results for the month of November:  
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.
Instructions
If maximizing net income is the objective, which is the best course of action?

Henderson Farms Reports the Following Results for the Month of November