Please answer just the highlighted questions.

VCI company is a video game distributor whose supplies video games to retailers such as BestBuy or Walmart. It is considering selling a new educational video game next year. This video game's suggested retail price (MSRP) is $20 and the retail margin is 40% of MSRP. To obtain the legal distribution right of the game, VCI will need to pay the developer $125,000. In addition, VCI estimates that a promotion cost of $50,000 is needed to introduce the game to retailers As of the production costs, each 1000 units of the game costs $4,000 for manufacturing, and $1,000 for labels, packages, and shipping $20.00 40% Retail Price (MSRP) 1. How much would VCl charge to the retailers for each unit of the new game? $12 MSRP is $20, which is how much consumers pay for each unit to retailers and those retailers will need a profit margin of 40%, which means $8 ($20x40%) is kept by the retailer as each unit is sold; this will leave $12 back to the manufacturer VCI, and this is the selling price of each unit from VCI to retailers Retail margin Pay developer 0 Promotion cost 1 Manufacturing 2 Shipping, Labeling, pkg $125,000.00 $50,000.00 $4,000.00 $1,000.00 e profit margin per unit? 4 (1) How many units of the new game VCI needs to sell in order to break-even? (Hint: How m 6 1. Unit Price: $20 * (1-40%) = $12 per unit 8 2. Unit Variable Cost: ($4,000 $1,000)/1,000- $5 per unit 0 3. Profit Margin per Unit: $12 $5 $7 per unit 2 4. Total Fixed Cost: $125,000 $50,000 $175,000 4 5. Break Even Volume: Fixed Cost/ Profit Margin $175,000/$7- 25,000 units 6 That is, VCI needs to sell 25,000 units to break even of this new game 2. How much is VCI's gross profit on each of unit sold to retailers? $7 Unit price minus unit variable cost: $12-$5 How do we get the $5? ($4000+$1000)/ 1000 units 8 (2) After break-even, how much profit each unit of the new game sales will generate? 9 0 | $7, the same as the unit profit margin. In fact, regardless of the break even issue, each unit c." 2 (1) If VCI not only wants to break even, it also has a $25,000 target profit, then how many units of the new game VCI needs to sell in order to reach this target profit? 4 (2) If VCI not only wants to break even, it also has a 25% ROS target, then how many units of the new game VCI needs to sell in order to reach this target ROS