13-25	Methuen Corporation makes a special-purpose machine, D4H, used in the textile industry. Methuen has designed the D4H machine for 2020 to be distinct from its competitors. It has been generally regarded as a superior machine. Methuen presents the following data for 2019and 2020
		2019	2020
	1. Units of D4H produces and sold	200	210
	2. Selling price	$ 43,000	$ 45,000
	3. Direct mateirals (kg)	310,000	317,500
	4. Direct material cost per kilogram	$ 7.25	$ 8.00
	5. Manufacturing capcacity in units of D4H	275	275
	6. Total conversion costs	$ 2,145,000	$ 2,172,500
	7. Conversion cost per unit of capacity	$ 7,800	$ 7,900
	8. Selling and customer-service capacity	95	90
	9. Total selling and customer-service cost	$ 1,045,000	$ 900,000
	10. Selling and customer-service capacity cost per customer	$ 11,000	$ 10,000
	Methuen produces no defective machines, but it wants to reduce direct materials usage per D4H machine in 2020. Conversion costs in each year depend on production capacity defined in terms of D4H units that can be produced, not the actual units produced. Selling and customer-service costs depend on the number of customers that Methuen can support, not the actual number of customers it serves. Methuen has 79 customers in 2019 and 84 customers in 2020.
13-27	Suppose that during 2020, the market for Methuens special-purpose machines grew by 3%. All increases in market share (that is, sales increases greater than 3%) are the result of Methuens strategic actions.
	Calculate how much of the change in operating income from 2019 to 2020 is due to the industry-market-size factor, product differentiation, and cost leadership. How successful has Methuen been in implementing its strategy? Explain.
13-28	1. Calculate the amount and cost of (a) unused manufacturing capacity and (b) unused selling and customer-service capacity at the beginning of 2020 based on actual production and actual number of customers served in 2020.
	2. Suppose Methuen can add or reduce its manufacturing capacity in increments of 40 units. What is the maximum amount of costs that Methuen could save in 2020 by downsizing manufacturing capacity?
	3. Methuen, in fact, does not eliminate any of its unused manufacturing capacity. Why might Methuen not downsize?