=+(row 6 ÷ row 5) $4 000 $4 100 Software-implementation labour-hour costs are variable costs. Software-implementation support costs for each year depend on the software-implementation support capacity that Bytes Ltd chooses to maintain each year (i.e. the number of jobs it can do each year).

It does not vary with the actual number of jobs done that year.

Required 1 Is Bytes Ltd’s strategy one of product differentiation or cost leadership? Explain briefly.