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Morning Sky, Incorporated (MSI), manufactures and sells computer games. The company has several product lines based on the age range of the target marketMSI sells
Morning Sky, Incorporated (MSI), manufactures and sells computer games. The company has several product lines based on the age range of the target marketMSI sells both individual games as well as packaged sets. All games are in CD format, and some utilize accessories such as steering wheels, electronic tablets, and hand controls. To date, MSI has developed and manufactured all the CDs itself as well as the accessories and packaging for all of its products.
Required information [The following information applies to the questions displayed below] Morning Sky, Incorporated (MSi), manufactures and sells computer games. The company has several product lines based on the age range of the target market. MSI sells both individual games as well as packaged sets. All games are in CD format, and some utilize accessories such as steering wheels, electronic tablets, and hand controls. To date, MSI has developed and manufactured all the CDs itself as well as the accessories and pockaging for all of its products. The gaming market has traditionally been targeted at teenogers and young adults; however, the increasing affordability of computers and the incorporation of computer activities into junior high and elementary school curriculums has lied to a significant increase in sales to younger children. MSt has always included games for younger children but now wants to expand its business to capitalize on changes in the industry. The company currently has excess capacity and is investigating several possible ways to improve profitability. MSI has been approached by a fourth-grade teacher from Portiand about the possibility of creating a specially designed game that would be customized for her classroom and ervironment. The teacher would like an educational game to correspond to her classroom coverage of the history of the Pacific Northwest, and the state of Oregon in particular. MSI has not sold its products directly to teachers or school systems in the past, but its Marketing Department identfied that possibility during a recent meeting. The teacher has offered to buy 2,000 copies of the CD at a price of $5.00 each. MSi could easily modify one of its existing edicational programs about U.S. history to accommodate the request. The modificotions would cost opproximately $440. A summary of the information related to production of MSr's current history program follows: Required: 1. Compute the incremental profit (or loss) from accepting the special ordet. 2. Should MSI accept the special order? 3. Suppose the special order had been to purchase 2,000 coplos of the program for $1,50 each. Compute the incremental profit for loss) from accepting the special order under this scenario. 4. Suppose MSt is operating ot full capacity. To accept the special ordes, it would have to reduce production of the history program. Compute the special order price at which MSI would be indifferent between accepting or rejecting the special ordet. 1. Compute the incremental profit (or loss) from accepting the special order: 2. Should MSI accept the special order? 3. Suppose the special order had been to purchase 2,000 copies of the program for $1.50 each. Compute the incremental profit (or loss) from accepting the special order under this scenario. 4. Suppose MSI is operating at full capacity. To accept the special order, it would have to reduce production of the history program. Compute the special order price of which MSI would be indifferent between accepting of rejecting the special order. Answer is not complete. Complete this question by entering your answers in the tabs below. Compute the incremental profit (or loss) from accepting the special order. Required: 1. Compute the incremental profit (or loss) from accepting the special order. 2. Should MSI accept the special order? 3. Suppose the special order had been to purchase 2,000 copies of the program for $1.50 each. Compute the incremental profit (or loss) from accepting the special order under this scenario. 4. Suppose MSI is operating at full capacity. To accept the special order, it would have to reduce production of the history program. Compute the special order price at which MSI would be indifferent between accepting or rejecting the special order, Answer is not complete. Complete this question by entering your answers in the tabs below. Suppose the special order had been to purchase 2,000 coples of the program for $1.50 each. Compute the incremental profit (or loss) from accepting the special order under this scenario. Compute the incremental profit (or loss) from accepting the special order Should MSI accept the special order? . Suppose the special order had been to purchase 2,000 coples of the program for $1.50 each. Compute the incremental profit (o loss) from accepting the special order under this scenario. . Suppose MSI is operating at full capacity. To accept the special order, it would have to reduce production of the history program. Compute the special order price at which MSI would be indifferent between accepting or rejecting the special order. Answer is not complete. Complete this question by entering your answers in the tabs below. Suppose MSI is operating at full capacity. To accept the special order, it would have to reduce production of the history program. Compute the special order price at which MSI would be indifferent between accepting or rejecting the 5pecial order. Note: Round your answer to 2 decimal places Step by Step Solution
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