Magic Realm, Incorporated, has developed a new fantasy board game. The company sold 60,000 games last year at a selling price of $60 per game. Fixed expenses associated with the game total $1,100,000 per year, and variable expenses are $40 per game. Production of the game is entrusted to a printing contractor. Variable expenses consist mostly of payments to this contractor. Required:
Magic Realm, Incorporated, has developed a new fantasy board game. The company sold 60,000 games last year at a selling price of $60 per game. Fixed expenses associated with the game total $1,100,000 per year, and variable expenses are $40 per game. Production of the game is entrusted to a printing contractor. Variable expenses consist mostly of payments to this contractor. Required:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Magic Realm, Incorporated, has developed a new fantasy board game. The company sold 60,000 games
last year at a selling price of $60 per game. Fixed expenses associated with the game total $1,100,000 per
year, and variable expenses are $40 per game. Production of the game is entrusted to a printing
contractor. Variable expenses consist mostly of payments to this contractor.
Required:
1-a. Prepare a contribution format income statement for the game last year.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe9320dfe-4b28-4edc-b2dd-c8c814c68e4a%2F59e01749-b414-4ee1-b4dc-abbab53a2f72%2Fzz6imi_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Magic Realm, Incorporated, has developed a new fantasy board game. The company sold 60,000 games
last year at a selling price of $60 per game. Fixed expenses associated with the game total $1,100,000 per
year, and variable expenses are $40 per game. Production of the game is entrusted to a printing
contractor. Variable expenses consist mostly of payments to this contractor.
Required:
1-a. Prepare a contribution format income statement for the game last year.
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