no use ai solution please provide correct answer of this General accounting question Magic Realm, Inc., has developed a new fantasy board game.The company sold 59,400 games last year at a selling price of$61 per game. Fixed expenses associated with the game total$1,089,000 per year, and variable expenses are $11 per game.Production of the game is entrusted to a printing contractor.Variable expenses consist mostly of payments to thiscontractor.a. Prepare a contribution format income statement for thegame last year.b. Compute the degree of operating leverage.

Step 1: Define LeverageIn the business world, leverage is a common concept. When a business is…

Answered: Magic Realm, Inc., has developed a new…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please help with 2A and 2B. I can't seem to figure those out. The other parts of the question I have completed. Magic Realm, Incorporated, has developed a new fantasy board game. The company sold 47,000 games last year at a selling price of $69 per game. Fixed expenses associated with the game total $846,000 per year, and variable expenses are $49 per game. Production of the game is entrusted to a printing contractor. Variable expenses consist mostly of payments to this contractor. 1-a. Prepare a contribution format income statement for the game last year. 1-b. Compute the degree of operating leverage. 2. Management is confident that the company can sell 58,280 games next year (an increase of 11,280 games, or 24%, over last year). Given this assumption: a. What is the expected percentage increase in net operating income for next year? b. What is the expected amount of net operating income for next year? (Do not prepare an income statement; use the degree of operating leverage to…
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 $182,000 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. 2. Prepare an income statement for the game last year and compute the degree of operating leverage. Management is confident that the company can sell 18,000 games next year (an increase of 3,000 games, or 20%, over last year). Compute: a. b. The expected percentage increase in net income for next year. The expected total dollar net income for next year.
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Toshovo Computer owns four production plants at which computer workstations are produced. The company can sell up to 40,000 computers per year at a price of $1500 per computer. For each plant, the production capacity, the production cost per computer,and the fixed cost of operating a plant for a year are given in the file P06_56.xlsx. Determine how Toshovo can maximize its yearly profit from computer production.

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