Problem 2 (Total: 26 marks) Wilkinson Corporation makes a special-purpose high-end computer monitor used in the education institutions. Wilkinson has designed the monitor to be distinct from its competitors and generally regarded as superior to competitors' products. Wilkinson Corporation presents the following data for the years 2020 and 2021: Units produced and sold Selling price Direct materials (pounds) Direct materials costs per pound Manufacturing capacity (units) Conversion costs Conversion costs per unit of capacity 2020 2021 9,000 10,000 $580 $600 27,000 26,600 $60 $64 12,000 12,000 $1,140,000 $95 $1,200,000 $100 Wilkinson Corporation produces no defective units but it wants to reduce direct materials usage per unit in 2021. Manufacturing conversion costs in each year depend on production capacity defined in terms of units that can be produced. Required: (i) (ii) (iii) Calculate operating income of Wilkinson Corporation for 2020 and 2021. (4 marks) Calculate the growth, price-recovery, and productivity components that explain the change in operating income from 2020 to 2021. (16 marks) Explain briefly whether Wilkinson Corporation's strategy is one of product differentiation or cost leadership. Summarize your answers in requirement (ii) in table format and briefly comment what these components indicate. (6 marks)