An analysis of Ruthen Corporation's operating income changes between 2015 and 2016 show the following:
$\begin{array}{lr}
\text { Operating income for } 2015 & \$ 4,750,000 \
\text { Add growth component } & 180,000 \
\text { Ded uct price-recovery component } & (60,000) \
\text { Add productivity component } & 285,000\\text { Operating income for } 2016&\$5,155,000
\end{array}$ Required:
Is Ruthen's operating income gain consistent with the product differentiation or cost leadership strategy? Explain briefly.

Question

An analysis of Ruthen Corporation's operating income changes between 2015 and 2016 show the following:
 $\begin{array}{lr}
\text { Operating income for } 2015 & \$ 4,750,000 \
\text { Add growth component } & 180,000 \
\text { Ded uct price-recovery component } & (60,000) \
\text { Add productivity component } & 285,000\\text { Operating income for } 2016&\$5,155,000
\end{array}$ Required:
Is Ruthen's operating income gain consistent with the product differentiation or cost leadership strategy? Explain briefly.

Quizplus · Accepted Answer

The Answer of An analysis of Ruthen Corporation's operating income changes between 2015 and 2016 show the following:
 $\begin{array}{lr}
\text { Operating income for } 2015 & \$ 4,750,000 \
\text { Add growth component } & 180,000 \
\text { Ded uct price-recovery component } & (60,000) \
\text { Add productivity component } & 285,000\\text { Operating income for } 2016&\$5,155,000
\end{array}$ Required:
Is Ruthen's operating income gain consistent with the product differentiation or cost leadership strategy? Explain briefly.

An Analysis of Ruthen Corporation's Operating Income Changes Between 2015