(a) What was their raw material and their labor productivity with the standard equipment? (b) What is their raw material and their labor productivity with the larger machine? (c) What is the change in each productivity measure?
Breakeven Analysis
Break Even Analysis is a term used in business, cost accounting and economics. It refers to a point where the total cost incurred becomes equal to the total revenue earned. Break Even Analysis determines the number of units to be sold to earn the revenue required to cover the total costs. Total cost is a sum total of fixed and variable costs.
Process analysis
The term process analysis can be defined as breakdown of production process into different phases that converts inputs into output. A series of routine activities are incorporated using organizational resources with a view to achieve operational excellence.
2. A firm cleans chemical tank cars in the Bay St. Louis area. With standard equipment, the
firm typically cleaned 70 chemical tank cars per month. They utilized 10 gallons of solvent, and
two employees worked 20 days per month, 8 hours a day. The company decided to switch to a
larger cleaning machine. Last April, they cleaned 60 tank cars in only 15 days. They utilized 12
gallons of solvent, and the two employees worked 6 hours a day.
(a) What was their raw material and their labor productivity with the standard equipment?
(b) What is their raw material and their labor productivity with the larger machine?
(c) What is the change in each productivity measure?
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