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My question is number 30. 13-29. STRATEGY, BALANCED SCORECARD, SERVICE COMPANY. Krater Associates is an architectural firm that has been in practice only a few
My question is number 30.
13-29. STRATEGY, BALANCED SCORECARD, SERVICE COMPANY. Krater Associates is an architectural firm that has been in practice only a few years. Because it is a relatively new firm, the market for the firm's services is very competitive. To compete successfully, Krater must deliver quality services at a low cost. Krater presents the following data for 2019 and 2020. 2019 2020 1. Number of jobs billed 44 46 2. Selling price per job $36,000 $35,000 3. Architect labor-hours 19,000 30,000 4. Cost per architect labor-hour $38 $39 5. Architect support capacity (number of jobs the firm can do) 61 61 6. Total cost of software-implementation support $164,700 $176,900 7. Software-implementation support-capacity cost per job $2,700 $2,900 Architect labor-hour costs are variable costs. Architect support costs for each year depend on the architectsupport capacity that Krater chooses to maintain each year (that is, the number of jobs it can do each year). Architect support costs do not vary with the actual number of jobs done that year. Required 1. Is Krater Associate's strategy one of product differentiation or cost leadership? Explain briefly. 2. Describe key measures you would include in Krater's balanced scorecard and your reasons fordoing so. IE 13-30. STRATEGIC ANALYSIS OF OPERATING (CONTINUATION OF 13-29). Refer to Exercise 13-29 Required 1. Calculate the operating income of Krater Associates in 2019 and 2020. 2. Calculate the growth, price-recovery, and productivity components that explain the change in operating income from 2019 to 2020. 3. Comment on your answer in requirement 2. What do these components indicateStep by Step Solution
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