Profile Productivity Measurement Objective In 20x2, Choctaw Company implements a new process affecting labor and materials....

Profile Productivity Measurement Objective

In 20x2, Choctaw Company implements a new process affecting labor and materials. The following reported data are provided to evaluate the effect on the company’s productivity:

	20x1	20x2
Number of units produced	600,000	480,000
Labor hours used	200,000	120,000
Materials used (lbs.)	857,143	640,000

Required:

1. Calculate the productivity profile for 20x1. If required, round your answers to two decimal places.

Partial Operational Productivity Ratios	20x1 Profile

Labor productivity ratio
Material productivity ratio

2. Calculate the productivity profile for 20x2. If required, round your answers to two decimal places.

Partial Operational Productivity Ratios	20x2 Profile

Labor productivity ratio
Material productivity ratio

3. What if the labor hours used in 20x2 were 157,500? What does comparison of the 20x1 and 20x2 profiles now communicate? If required, round your answers to two decimal places.

Partial Operational Productivity Ratios	20x1 Profile	20x2 Profile

Labor productivity ratio
Material productivity ratio

Solutions

Expert Solution

Answer

The ratio of output to an input is known as a Partial Operational Productivity Ratio.

Most important & most often used Partial Operational Productivity Ratio are Labour productivity ratio,Material productivity ratio & Capital productivity ratio

Labour Productivity Ratio = Output / Labour Input
Material Productivity Ratio = Output / Material Input

Given Data

	20x1	20x2
Number of units produced	600,000	480,000
Labor hours used	200,000	120,000
Materials used (lbs.)	857,143	640,000

Productivity profile for 20x1

Productivity Ratios	Workings	20x1
Labour Productivity Ratio	600,000 / 200,000	3.00
Material Productivity Ratio	600,000 / 857,143	00.70

Productivity profile for 20x2

Productivity Ratios	Workings	20x2
Labour Productivity Ratio	480,000 / 120,000	4.00
Material Productivity Ratio	480,000 / 640,000	00.75

3) if the labour hours used in 20x2 were 157,500

Productivity profile for 20x1 and 20x2

Productivity Ratios	20x1	20x2
Labour Productivity Ratio	3.00	3.04
	(600,000 / 200,000)	(480,000 / 157,500)
Material Productivity Ratio	00.70	00.75
	(600,000 / 857,143)	(480,000 / 640,000)

Labour productivity ratio & Material productivity ratio of 20x2 is higher than 20x1

ekkarill92 answered 1 year ago

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