1. Prepare the productivity part of the report for Mr. Richards. He probably expects some analysis...

Question

1. Prepare the productivity part of the report for Mr. Richards. He probably expects some analysis of productivity inputs for all factors, as well as a multifactor analysis for both years with the change in productivity (up or down) and the amount noted.
2. The producer price index had increased from 120 to 125, and this seemed to indicate to Mr. Richards that his costs were too high. What do you tell him are the implications of this change in the producer price index?
3. Management’s expectation for departments such as Mr. Richard’s is an annual productivity increase of 5%. Did he reach this goal?

Robert · Accepted Answer

2008
	2009
	Production (units)
	4500
	6000
	Raw Materials
	700
	900
	Labor Hours
	22000
	28000
	Capital Cost (Fixed)
	375000
	620000
We got to know the price of Raw materials and Labor Hours for both the years.
	
	2008
	2009
	Raw Materials
	$320 per barrel
	$360 per barrel
	Labor cost
	$13 per hour
	$14 per hour
Calculating the costs
For 2008:

1. Prepare the productivity part of the report for Mr. Richards. He probably expects some analysis of productivity inputs for all factors, as well as a multifactor analysis for both years with the...

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