Analysis of growth, price-recovery, and productivity components (continuation of 13-31). Suppose that during 2013, the market for ZP98 grew 8%. All increases in market share (that is, sales increases greater than 8%) are the result of Dransfield€™s strategic actions.
In exercise

REQUIRED
Calculate how much of the change in operating income from 2012 to 2013 is due to the industry market-size factor, product differentiation, and cost leadership. How does this relate to Dransfield€™s strategy and its success in implementation? Explain.

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2012 2013 1a. Units of ZP98 produced and sold 1b. Units of ZP98 returned 1c. Net sales in units 2. Selling price 3. Direct materials (pounds) used 4. Direct materials cost per pound 5. Manufacturing capacity in units of ZP98 6. Total conversion costs 7. Conversion cost per unit of capacity 8. Selling and customer-service capacity 9. Total selling and customer-service costs 10. Selling and customer-service capacity cost per customer 11. Advertising staff 12. Total advertising costs 13. Advertising cost per employee 5,000 500 4,500 $44 2,500 $10 8,000 S128,000 $16 60 customers $4,000 $%66.67 6,250 225 6,025 S50 3,125 S10 8,000 $184,000 S23 60 customers S4,180 S69.67 $20,000 S20,000 $24,000 $24,000