Strategic Analysis of Profitability of Ransham Company:



Income

Statement

Amounts

in 2019

Revenue and

Cost Effects

of Growth

Component

in 2020

Revenue and

Cost Effects of

Price-Recovery

Component

in 2019

Cost Effect of

Productivity

Component

in 2020

Income

Statement

Amounts

in 2020

Revenues ($)

34,000

10,000 F

1,000 U

(b)

(e)

Costs

23,500

(a)

500 U

(c)

26,100

Operating income

10,500

5,500 F

1,500 U

2,400 F

(d)

What is the cost effect of the growth component (a)?