Question 1
________ are the subdivisions of income that management accountants use for the strategic analysis of operating income.
◦ Growth, price-recovery and cost leadership components
◦ Growth, price-recovery and productivity components
◦ Cost leadership, price-recovery and productivity components
◦ Growth, cost leadership and productivity components
Question 2
An operating income analysis of Fast Processing Company revealed the following:
| Operating income for 2017 | $1,207,000 |
| Add growth component | 102,000 |
| Deduct price-recovery component | (95,000) |
| Add productivity component | 90,000 |
| Operating income for 2018 | $1,304,000 |
Fast's operating income gain is consistent with the ________.
◦ product differentiation strategy
◦ product leadership strategy
◦ cost differentiation strategy
◦ cost leadership strategy
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