Kirkland Video Games Inc has spent $450,000 to develop a new video game. It is the most
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(a) Calculate the amount of operating income the company will earn if it takes 10 months for a competitor to produce a more sophisticated version of the video game.
(b) Calculate how many units of the video game the company will have to sell in order to break even.
(c) If the company wishes to earn $30,000 over the product's life, calculate the selling price of the video game if a competitor introduces a more sophisticated version of the video game in six months. Assume that unit sales are 300 copies per month.
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Related Book For
Managerial Accounting Tools for Business Decision Making
ISBN: 978-1118856994
4th Canadian edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly
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