Summer Corporation is a small information systems consulting firm that specializes in helping companies implement sales management software. The market for Summer's products is very competitive. To compete, Summer must deliver quality service low cost. Summer bills clients in terms of units of work performed, which depends on the size and complexity of the sales management system. Summer presents the following data for the years 2018 and 2019. (Click the icon to view the data.) (Click the icon to view the additional information.) Required 1. Calculate the change in operating income of Summer Corporation in 2018 and 2019. 2. Calculate the growth, price-recovery, and productivity components of changes in operating income between 2018 and 2019. 3. Comment on your answer in requirement 2. What do these components indicate? x Data Table Requirement 1. Calculate the change in operating income of Summer Corporation in 2018 and 2019. (Use a minus sian or parenthes 1 More Info - X Revenues Costs 2018 2019 Software implementation labour cos Software implementation support cd 110 130 $ 55,000 $ 54,000 Software development costs Software implementation labour-hour costs are variable costs. Software implementation support costs for each year depend on the software implementation support capacity (defined in terms of units of work) that Summer chooses to maintain each year. It does not vary with the actual units of work performed each year. At the start of each year, management uses its discretion to determine the number of software-development employees. The software-development staff and costs have no direct relationship with the number of units of work performed. 28,000 30,000 Total costs $ 61 $ 62 Operating income 135 135 1. Units of work performed 2. Selling price 3. Software implementation labour-hours 4. Cost per software implementation labour-hour 5. Software implementation support capacity (units of work) 6. Total cost of software implementation support 7. Software implementation support capacity cost per unit of work 8. Number of employees doing software development 9. Total software development costs 10. Software development cost per employee $ 540,000 $ 553,500 $ 4,000 $ 4,100 Requirement 2. Calculate the growth, Print Done To assist you, use the popup to identify B (Click the icon to view the componerns you wii Use II your formulas.) Begin by determining the formula to calculate the revenue effect of growth. Then, enter the amounts in the formula. 6 6 $ 930,000 $ 972,000 $ 155,000 $ 162,000 ) x Revenue effect of growth ) x Print Done Next, determine the formula to calculate the cost effect of growth for variable costs. Then, enter the amounts in the formula. Think, bas each answer to the nearest whole dollar.) Summer Corporation is a small information systems consulting firm that specializes in helping companies implement sales management software. The market for Summer's products is very competitive. To compete, Summer must deliver quality service low cost. Summer bills clients in terms of units of work performed, which depends on the size and complexity of the sales management system. Summer presents the following data for the years 2018 and 2019. (Click the icon to view the data.) (Click the icon to view the additional information.) Required 1. Calculate the change in operating income of Summer Corporation in 2018 and 2019. 2. Calculate the growth, price-recovery, and productivity components of changes in operating income between 2018 and 2019. 3. Comment on your answer in requirement 2. What do these components indicate? x Data Table Requirement 1. Calculate the change in operating income of Summer Corporation in 2018 and 2019. (Use a minus sian or parenthes 1 More Info - X Revenues Costs 2018 2019 Software implementation labour cos Software implementation support cd 110 130 $ 55,000 $ 54,000 Software development costs Software implementation labour-hour costs are variable costs. Software implementation support costs for each year depend on the software implementation support capacity (defined in terms of units of work) that Summer chooses to maintain each year. It does not vary with the actual units of work performed each year. At the start of each year, management uses its discretion to determine the number of software-development employees. The software-development staff and costs have no direct relationship with the number of units of work performed. 28,000 30,000 Total costs $ 61 $ 62 Operating income 135 135 1. Units of work performed 2. Selling price 3. Software implementation labour-hours 4. Cost per software implementation labour-hour 5. Software implementation support capacity (units of work) 6. Total cost of software implementation support 7. Software implementation support capacity cost per unit of work 8. Number of employees doing software development 9. Total software development costs 10. Software development cost per employee $ 540,000 $ 553,500 $ 4,000 $ 4,100 Requirement 2. Calculate the growth, Print Done To assist you, use the popup to identify B (Click the icon to view the componerns you wii Use II your formulas.) Begin by determining the formula to calculate the revenue effect of growth. Then, enter the amounts in the formula. 6 6 $ 930,000 $ 972,000 $ 155,000 $ 162,000 ) x Revenue effect of growth ) x Print Done Next, determine the formula to calculate the cost effect of growth for variable costs. Then, enter the amounts in the formula. Think, bas each answer to the nearest whole dollar.)
