In the 10th edition of their Cost Accounting text, Horngren, Foster and Datar introduce the concept of strategic analysis of operating income by separating a company's operating income into growth, price-recovery, and productivity components. These components are then used to evaluate the success, or lack thereof, of a company's cost-leadership or product differentiation strategies. I extend their analysis of fixed capacity costs in the following manner. First, I suggest that the ''long-term view'' supported by activity-based costing might be more appropriate for determining the growth component instead of the ''short-term view'' supported by throughput costing and Goldratt and Cox in The Goal. Next, I introduce a new component called capacity underutilization into their formulation which highlights the impact of (1) changing capacity costs relating to unused capacities, (2) changes in available capacities between the years, and (3) changes in capacities used between the years.