18.1 As the cost accounting manager at Cambria Chemicals (CC), you are responsib
ID: 2527855 • Letter: 1
Question
18.1
As the cost accounting manager at Cambria Chemicals (CC), you are responsible for compiling and reporting various performance measures to the senior managers. The company instituted many efficiency improvement programs recently, and the CFO has asked you to measure and report total factor productivity measures based on the three inputs (material, labor, and overhead). Data for the last two years follow: Gallons input (thousands) Labor-hours (thousands) Gallons of output (thousands) Year 2 Year 1 9,200 9,200 6,800 12,000 10,000 10,200 9, From the accounting records, you also gather the following information for the two years: Year 2 Year 1 Cost of inputs (per gallon) Wage rate (per hour) Total manufacturing overhead Selling price of output (per gallon) 80 17 $1,310,000 $1,210,000 370 82 $ 23 S 365 S Required a. Compute the total factor productivity measures for year 1 and year 2 based on the three inputs (material, labor, and overhead). (Round your answers to 3 decimal places.) Year 2 Year 1 Total factor productivityExplanation / Answer
Explanation:
Total productivity = Value of output ÷ Value of inputs (materials, labor, and overhead).
Year 1
Total output value
($370 x 10000)
$3700000
Materials value
($80 x 9200)
$736000
Labor value
($17 x 6800)
$115600
Overhead value (given)
$1210000
$2061600
Total factor productivity
1.794
Year 2
Total output value
($365 x 12000)
$4380000
Materials value
($82 x 10200)
$836400
Labor value
($23 x 9200)
$211600
Overhead value (given)
$1310000
$2358000
Total factor productivity
1.857
Year 1
Total output value
($370 x 10000)
$3700000
Materials value
($80 x 9200)
$736000
Labor value
($17 x 6800)
$115600
Overhead value (given)
$1210000
$2061600
Total factor productivity
1.794
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.