Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Show Work ! Required information [The following information applies to the questions dispiayed below.] Morning Sky. Inc. (MSI), manufactures and sells computer games. The company
Show Work !
Required information [The following information applies to the questions dispiayed below.] Morning Sky. Inc. (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 C.D format, and some utilize accessorles 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. The gaming market has traditionally been targeted at teenagers and young adults; however, the increasing affordability of computers and the incorporation of computer activities into junior high and elementary school curriculums has led to a significant increase in sales to younger children. MSI 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 environment. The teacher would like an educational game to correspond to her classroom coverage of the history of the Paclic 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 identified that possibility during a recent meeting. The teacher has offered to buy 1,800 copies of the CD at a price of $5.00 each. MSI could easily modify one of its existing educational programs about U.S, history to accommodate the request. The modifications would cost approximately $330. A summary of the information related to production of MSI's current history program follows; Required: 1. Compute the incremental profit (or loss) from accepting the special order. 2. Should MSt accept the special order? 3. Suppose that the special order had been to purchase 1,800 copies of the program for $1.50 each. Compute the incremental profit (or loss) from accepting the special order under this scenario. 4. Suppose that 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. Complete this question by entering your answers in the tabs below. Compute the incremental profit (or loss) from accepting the special order. Required information [The following information applies to the questions dispiayed below.] Morning Sky. Inc. (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 C.D format, and some utilize accessorles 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. The gaming market has traditionally been targeted at teenagers and young adults; however, the increasing affordability of computers and the incorporation of computer activities into junior high and elementary school curriculums has led to a significant increase in sales to younger children. MSI 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 environment. The teacher would like an educational game to correspond to her classroom coverage of the history of the Paclic 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 identified that possibility during a recent meeting. The teacher has offered to buy 1,800 copies of the CD at a price of $5.00 each. MSI could easily modify one of its existing educational programs about U.S, history to accommodate the request. The modifications would cost approximately $330. A summary of the information related to production of MSI's current history program follows; Required: 1. Compute the incremental profit (or loss) from accepting the special order. 2. Should MSt accept the special order? 3. Suppose that the special order had been to purchase 1,800 copies of the program for $1.50 each. Compute the incremental profit (or loss) from accepting the special order under this scenario. 4. Suppose that 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. Complete this question by entering your answers in the tabs below. Compute the incremental profit (or loss) from accepting the special order Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started