Revenue effect of grow. (40,000 40,000) x bo = O 3 Oct Managerial group assignments Case 1 14-37 Strategic analysis of operating income. LO 4) Halsey company sells women's clothing Halsey's strategy is to offer a wide selection of clothes and excellent customer service and to charge a premium price. Halsey presents the following data for 2021 and 2022 For simplicity, assume that each customer purchases one piece of clothing 2022 1. Pieces of clothing purchased and sold 2 Average selling price 3. Average cost per piece of clothing 2021 40,000 560 $40 40,000 $50 $41 4. Selling and customer service capacity 51,000 customers 43,000 customers 5. Selling and customer service costs $357,000 $296,700 6. Selling and customer service capacity per customer $7 per customer $6.90 per customers (Line 5/Line 4) 7. Purchasing and administrative capacity designe 8. Purchasing and administrative costs $204,000 980 designs $245,000 9 Purchasing and administrative capacity cost per distinct $250 per design design 850 $240 per Design (Line 8/Line 7) Total selling and customer service costs depend on the number of customers that Hasley has created the capacity to support, not the actual number of customers that Hasley serves. Total purchasing and administrative costs depend on purchasing and administrative capacity that Hasley has created (defined in terms of the number of distinct clothing designs that Hasley can purchase and administer). Purchasing and administrative costs do not depend on the actual number of distinct clothing designs purchased. Halsey purchased 930 distinct designs in 2021 and 820 distinct designs in 2022 At the start of 201 991 At the start of 2022, Halsey planned to increase operating income by 10% over operating income in 2021. Required 1. Is Halsey's strategy one of product differentiation or cost leadership? Explain. 2. Calculate the change in Halsey's operating income in 2021 and 2022. 3. Calculate the growth, price-recovery, and productivity components of changes in operating income between 2021 and 2022. 4. Does the strategic analysis of operating income indicate Halsey was successful in implementing its strategy in 2022? Explain. Check Figure: 2. Change in operating income, $21,300 F 14-38 Balanced scorecard, sustainability. (LO 3) Nost Vineyards is a 592 14C Sunny 5-58 PM 01/10/2022