Concept explainers
A
Interpretation: average costs based on the provided multifactor ratio is to be calculated.
Concept Introduction: The multifactor productivity enables an organization to identify how effective their processes are as it computes and involves all the costs involved in the production process.
B
Interpretation: A’s labor productivity ratio for each type of cake is to be calculated.
Concept Introduction: The labor productivity enables an organization to identify how effective their processes are as it computes and involves all the costs involved in the production process.
C
Interpretation: The most prospective item as per the labor productivity ratio.
Concept Introduction: Labor productivity ratio computes the productivity of the workforce, this measures the number of units produced within an hour. This is used to identify how efficient the workforce is.
D
Interpretation: Based on the multifactor calculations, the product to be discontinued is to be determined.
Concept Introduction: The multifactor productivity enables an organization to identify how effective their processes are as it computes and involves all the costs involved in the production process.
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Operations Management: Processes And Supply Chains (12th Global Edition) - Does Not Include Mylab Operations Management
- Barry’s Tire Service completed 100 tire changes, six brake jobs, and 16 alignments in an eight-hour day with his standard crew of six mechanics. A brake specialist costs $16 per hour, a tire changer costs $8 per hour, an an alignment mechanic costs $14 per hour. The materials cost for days was $2,000, and overhead cost was $500. What is the shop’s labor productivity if the retail price for each respective service is $60, $150, and $40? What is the multifactor productivity, if the crew consisted of two of each type mechanicarrow_forwardGiven the following information, calculate the multifactor productivity in terms of revenue per multifactor cost. (In other words, use money in the numerator and denominator.)Units produced: 5,000Standard price: $30/unitLabor input: 500 hoursCost of labor: $25/hourCost of materials: $5,000Cost of overhead: 2x labor costA) State the formulaB) Determine the unit of measure for the numeratorC) Determine the unit of measure for the denominatorD) Calculate ProductivityD) Interpret the resultsarrow_forwardThe following table shows data on the average number of customers processed by several bank service units each day. The hourly wage rate is $25, the overhead rate is 1.0 times labor cost, and material cost is $5 per customer.Unit EmployeesCustomersProcessed/DayA 4 36B 5 40C 8 60D 3 20a. Compute the labor productivity and the multifactor productivity for each unit. Use an eighthour day for multifactor productivity.arrow_forward
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