Cost Accounting (15th Edition)
Cost Accounting (15th Edition)
15th Edition
ISBN: 9780133428704
Author: Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
Question
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Chapter 12, Problem 12.20E
To determine

The change in operating income from 2012 to 2013 due to growth in market size, product differentiation and cost leadership. Whether the company has been successful in implementing the strategy or not.

Given information:

For the year 2012,

The number of T-shirts sold is 205,000.

The average selling price is $32 per T-shirt.

The number of T-shirts purchased is 225,500.

The average cost per T-shirt is $17.

The administrative cost is $1,739,000.

For the year 2013,

The number of T-shirts sold is 233,000.

The average selling price is $33 per T-shirt.

The number of T-shirts purchased is 257,000.

The average cost per T-shirt is $15.

The administrative cost is $1,691,000.

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