Magic Realm Inc Has Developed A New Fantasy Board Game The Company Sold 15 000 Games Last Year At A Selling Price Of 1 (25.41 KiB) Viewed 12 times
Magic Realm Inc Has Developed A New Fantasy Board Game The Company Sold 15 000 Games Last Year At A Selling Price Of 2 (30.39 KiB) Viewed 12 times
Magic Realm, Inc. has developed a new fantasy board game. The company sold 15,000 games last year at a selling price of $20 per game. Fixed costs associated with the game total $170,000 per year, and variable costs are $6 per game. Production of the game is entrusted to a printing contractor. Variable costs consist mostly of payments to this contractor. Required: 1-a. Prepare an income statement for the game last year. Sales Less: Variable expenses Contribution margin Less Fixed expenses Net income S Total 0 0 Per Unit 0
1-b. Compute the degree of operating leverage. (Round your answer to 2 decimal places.) Degree of operating loverage. 2. Management believes that the company's sales will increase by 3,000 games next year. Compute the following: a. The expected percentage increase in net income for next year. (Do not round intermediate calculations.) Expected percentage % b. The expected total dollar net income for next year. (Do not prepare an income statement; use the degree of operating leverage to compute your answer.) (Do not round intermediate calculations.) Total expected net income
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