Additional Information

Total selling and customer$-$service costs depend on the number of customers that

Hampstead has created capacity to support, not the actual number of customers

that Halsey serves. Total purchasing and administrative costs depend on

purchasing and administrative capacity that Hampstead has created $($defined in

terms of the number of distinct clothing designs that Hampstead can purchase

and administer$).$ Purchasing and administrative costs do not depend on the actual

number of distinct clothing designs purchased. Hampstead purchased $910$ distinct

designs in $2021$ and $835$ distinct designs in $2022.$

At the start of $2022,$ Hampstead planned to increase operating income by $6\%$ over

operating income in $2021.$