Question
In: Accounting
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 |
1)
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 |
2)
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 3 years agoRelated Solutions
Profile Productivity Measurement Objective In 2015, Choctaw Company implements a new process affecting labor and materials....
Profile Productivity Measurement Objective
In 2015, 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:
2014
2015
Number of units produced
630,000
390,000
Labor hours used
210,000
97,500
Materials used (lbs.)
1,145,455
650,000
Required:
1. Calculate the productivity profile for 2014.
If required, round your answers to two decimal places.
Partial Operational Productivity Ratios
2014 Profile
Labor productivity ratio
Material productivity ratio
2. Calculate the...
Profit-Linked Productivity Measurement In 20x2, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked Productivity Measurement
In 20x2, Choctaw Company implements a new process affecting
labor and materials.
Choctaw Company provides the following information so that total
productivity can be valued:
20x1
20x2
Number of units produced
510,000
420,000
Labor hours used
170,000
210,000
Materials used (lbs.)
2,550,000
1,400,000
Unit selling price
$21
$23
Wages per labor hour
$13
$15
Cost per pound of material
$3.70
$3.80
Required:
1. Calculate the cost of inputs in 20x2,
assuming no productivity change from 20x1 to...
Profit-Linked Productivity Measurement In 20x2, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked Productivity Measurement In 20x2, Choctaw Company
implements a new process affecting labor and materials. Choctaw
Company provides the following information so that total
productivity can be valued: 20x1 20x2 Number of units produced
570,000 480,000 Labor hours used 190,000 240,000 Materials used
(lbs.) 2,850,000 1,600,000 Unit selling price $20 $22 Wages per
labor hour $13 $15 Cost per pound of material $3.40 $3.50
Required: 1. Calculate the cost of inputs in 20x2, assuming no
productivity change from 20x1 to...
Profit-Linked Productivity Measurement In 20x2, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked
Productivity Measurement
In 20x2, Choctaw
Company implements a new process affecting labor and materials.
Choctaw Company
provides the following information so that total productivity can
be valued:
20x1
20x2
Number of units produced
540,000
450,000
Labor hours used
108,000
112,500
Materials used (lbs.)
2,160,000
1,500,000
Unit selling price
$20
$22
Wages per labor hour
$12
$14
Cost per pound of material
$3.40
$3.50
Required:
1.
Calculate the cost of inputs in 20x2, assuming no productivity
change from 20x1 to...
Profit-Linked Productivity Measurement In 20x2, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked Productivity Measurement
In 20x2, Choctaw Company implements a new process affecting
labor and materials.
Choctaw Company provides the following information so that total
productivity can be valued:
20x1
20x2
Number of units produced
570,000
480,000
Labor hours used
190,000
240,000
Materials used (lbs.)
2,850,000
1,600,000
Unit selling price
$23
$25
Wages per labor hour
$12
$14
Cost per pound of material
$3.80
$3.90
Required:
1. Calculate the cost of inputs in 20x2,
assuming no productivity change from 20x1 to...
Profit-Linked Productivity Measurement In 2015, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked Productivity Measurement
In 2015, Choctaw Company implements a new process affecting
labor and materials.
Choctaw Company provides the following information so that total
productivity can be valued:
2014
2015
Number of units produced
570,000
480,000
Labor hours used
114,000
120,000
Materials used (lbs.)
2,850,000
1,600,000
Unit selling price
20
22
Wages per labor hour
12
14
Cost per pound of material
3.70
3.80
Required:
1. Calculate the cost of inputs in 2015,
assuming no productivity change from 2014 to...
Profit-Linked Productivity Measurement In 2015, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked Productivity Measurement
In 2015, Choctaw Company implements a new process affecting
labor and materials.
Choctaw Company provides the following information so that total
productivity can be valued:
2014
2015
Number of units produced
570,000
480,000
Labor hours used
114,000
120,000
Materials used (lbs.)
1,900,000
1,200,000
Unit selling price
25
27
Wages per labor hour
16
18
Cost per pound of material
3.70
3.80
Required:
1. Calculate the cost of inputs in 2015,
assuming no productivity change from 2014 to...
Profit-Linked Productivity Measurement In 2015, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked Productivity Measurement
In 2015, Choctaw Company implements a new process affecting
labor and materials. Choctaw Company provides the following
information so that total productivity can be valued:
2014
2015
Number of units
produced
510,000
420,000
Labor hours
used
170,000
210,000
Materials used
(lbs.)
1,700,000
1,050,000
Unit selling
price
22
24
Wages per labor
hour
12
14
Cost per pound of
material
3.50
3.60
Required:
1. Calculate the cost of inputs in 2015, assuming no
productivity change from 2014...
Profit-Linked Productivity Measurement In 2015, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked Productivity Measurement In 2015, Choctaw Company
implements a new process affecting labor and materials. Choctaw
Company provides the following information so that total
productivity can be valued: 2014 2015 Number of units produced
510,000 420,000 Labor hours used 102,000 105,000 Materials used
(lbs.) 1,700,000 1,050,000 Unit selling price 24 26 Wages per labor
hour 14 16 Cost per pound of material 3.90 4.00
Required: 1. Calculate the cost of inputs in 2015, assuming no
productivity change from 2014 to...
Profit-Linked Productivity Measurement In 2015, Choctaw Company implements a new process affecting labor and materials. Choctaw...
Profit-Linked Productivity Measurement
In 2015, Choctaw Company implements a new process affecting
labor and materials.
Choctaw Company provides the following information so that total
productivity can be valued:
2014
2015
Number of units produced
570,000
480,000
Labor hours used
114,000
120,000
Materials used (lbs.)
1,900,000
1,200,000
Unit selling price
25
27
Wages per labor hour
16
18
Cost per pound of material
3.70
3.80
Required:
1. Calculate the cost of inputs in 2015,
assuming no productivity change from 2014 to...
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