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Magic Realm, Inc, has developed a new fantasy board game. The company sold 18,400 games last year at a selling price of $67 per game.

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Magic Realm, Inc, has developed a new fantasy board game. The company sold 18,400 games last year at a selling price of $67 per game. Fived expenses associated with the game total $276,000 per year, and variable expenses are $47 per game. Production of the game is entrusted to a printing contractor Variable expenses consist mostly of payments to this contractor Required: t-a. Prepare a contribution format income statement for the game list your b. Compute the degree of operating leverage 2 Management is conndent that the company can sell 22,264 games next year can increase of 3,864 games, 0212ever last year Given this assumption 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 compute your answer)

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