1. Variable expense per unit 2. Break-even point in units Break-even point in dollar sales 3. Unit sales needed to attain target profit Dollar sales needed to attain target profit 4. New break-even point in unit sales New break-even point in dollar sales Dollar sales needed to attain target profit $ 19.60 17,500 $ 490,000 25,000 $ 700,000 13,125 $ 600,000 $ 750,000 Req 1A Req 1B Req 2 Prepare a contribution format income statement for the game last year. Magic Realm, Inc., Contribution Income Statement Sales Variable expenses Total Per Unit $ 2,881,000 $ 67 20,210,000 47 (17,329,000) $ 20 Contribution margin Fixed expenses Net operating income 774,000 $ (18,103,000) Req 1A Req 1B Req 2 Compute the degree of operating leverage. Degree of operating leverage 10 Req 1A Req 1B Req 2 Management is confident that the company can sell 52,460 games next year (an increase year). Given this assumption: a. 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 a of operating leverage to compute your answer.) a. Net operating income increases by 220% b. Total expected net operating income $ 266,600