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LO 1 E apacity. Why O 13-27 Growth, price-recovery, and productivity components. Lakeside T-Shirt Company For simplicity, assume that all purchasing and selling costs are
LO 1 E apacity. Why O 13-27 Growth, price-recovery, and productivity components. Lakeside T-Shirt Company For simplicity, assume that all purchasing and selling costs are included in the average cost per T-shin a variety of T-shirts, Lakeside presents the following data for its first two years of operations, 2018 and 2 that each customer buys one T-shirt. Number of T-shirts purchased Number of T-shirts lost Number of T-shirts sold Average selling price Average cost per T-shirt Administrative capacity in terms of number of customers who can be served Administrative costs Administrative cost per customer Design staff Total design costs Design cost per employee Required 2018 2019 200,000 250.000 2,000 3.300 198,000 246,700 $25.00 $26.00 $10.00 $8.50 4,000 3,750 $1,200,000 $1,162,500 $300 $310 5 $250,000 $275,000 $50,000 $55,000 LO 1 ing income, 351.700 F 1. Is Lakeside's strategy one of value or cost leadership? Explain briefly. 2. Describe briefly the key elements Lakeside should include in its BSC and the reasons it should do so 13-28 Strategic analysis of operating income (continuation of Exercise 13-27). Required 1. Calculate Lakeside's operating income in both 2018 and 2019. 2. Calculate the growth, price-recovery, and productivity components that explain the change in operat ing income from 2018 to 2019. 3. Comment on your answers in requirement 2. What do each of these components indicate
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