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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 expense associated with the game total $182,000 per year, and variable expense are $6 per game. Production of the game is entrusted to a printing contractor. Variable expense consist mostly of payments to this contractor. Required: 1-a. Prepare a contribution format income statement for the game last year. Magic Realm, Inc., Contribution Income Statement Total Per Unit 1-b. Compute the degree of operating leverage. (Round your answer to 1 decimal place.) Degree of operating leverage 2. Management is confident that the company can sell 18,000 games next year (an increase of 3,000 games, or 20%, over last year). a. Compute the expected percentage increase in net operating income for next year. (Do not round intermediate calculations.) Net operating income increases by % b. Compute the expected total dollar net operating 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 operating income

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