Exercise 6-3 (Video) Ex Your answer is incorrect. Try again. Barnes Company reports the following operating results for the month of August: sales $300,000 (units 5,000); variable costs $217,000, and fixed costs $71,800. 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. Net income 14200 2. Reduce variable costs to 56% of sales. Net Income 3. Reduce fixed costs by $18,000. Net income Which course of action will produce the highest net income