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Magic Realm, Incorporated, developed a new fantasy board game and sold 41,500 units last year...

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Accounting

Magic Realm, Incorporated, developed a new fantasy board game and sold 41,500 units last year at a selling price of $62 per game. Fixed expenses associated with the game are $747,000 per year, and variable expenses are $42 per game. Production of the game was outsourced to a printing contractor, so variable expenses consist mostly of payments to this contractor. Required: 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 53,950 games next year (an increase of 12,450 games, or 30%, over last year). Given this assumption: a. What is the expected percentage increase in net operating income for next year

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