A productivity index of 110% means that a companys labor costs would have been 10% higher if it had not made production improvements. Assume that Baldwin had a productivity index of 112% and that Chester had a productivity index of 103%. Now refer to the Income Statements in the Annual Report for Baldwin and Chester. Using the labor costs shown in the Income Statements, how much more did Baldwin save in direct labor costs compared to Chester by having a higher productivity index?

Select: 1

$3,507

$2,869

$3,188

$3,347

Annual Report C59559 Baldwin 2016 Income Statement (Product Name Buddy Batt Bead Na Na Sales $25,462 $31,799 $34,818 $39,664 $0 $0 Variable Costs: Direct Labor $5,419 $7,103 $9,505 $10,585 $0 $0 Direct Material $9,390 $12,528 $14,463 $17,004 $0 $0 Inventory Carry $313 $399 $330 $194 $0 $0 Total Variable $15,122 $20,030 $24,298 $27,782 $0 $0 Contribution $10,340 $11,770 $10,520 $11,881 $0 $0 Margin Period Cost Depreciation $2,660 $3,167 $1,800 $1,900 $0 $0 $958 $979 $936 $896 $1,050 $1,050 $1,050 $1,050 $1,000 $800 $600 $600 $337 $421 $46 $525 SG&A R&D $0 $0 Promotions $0 $0 Sales $0 $0 Admin $0 $0 Total Period $6,004 $6,416 $4,847 $4,971 $0 $0 Net Margin $4,336 $5,354 $5,674 $6,910 $0 $0 Na $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Round: 0 Dec. 31, 2016 2016 Common Na Total Size $0 $131,743 100.0% $0 $32,611 24.8% $0 $53,385 40.5% $0 $1,235 0.9% $0 $87,231 66.2% $0 $44,512 33.8% $0 $9,527 7.2% $0 $3,768 2.9% $0 $4,200 3.2% $0 $3,000 2.3% $0 $1,744 1.3% $0 $22,239 16.9% $0 $22,273 6.9%