Question
Basics of Productivity Measurement Holbrook Company gathered the following data for the past two years: Base Year Current Year Output 940,000 1,110,000 Output prices $14
Basics of Productivity Measurement
Holbrook Company gathered the following data for the past two years:
Base Year | Current Year | |
Output | 940,000 | 1,110,000 |
Output prices | $14 | $14 |
Input quantities: | ||
Materials (lbs.) | 188,000 | 1,110,000 |
Labor (hrs.) | 94,000 | 555,000 |
Input prices: | ||
Materials | $5 | $6 |
Labor | $8 | $8 |
Required:
1. Prepare a productivity profile for each year. If required, round your answers to two decimal places.
Holbrook Company | ||
Productivity Profile | ||
Base Year | Current Year | |
Materials productivity ratio | ||
Labor productivity ratio |
2. Prepare partial income statements for each year.
Holbrook Company | ||
Partial Income Statements | ||
Base Year | Current Year | |
Sales | $ | $ |
Materials | ||
Labor | ||
Gross profit | $ | $ |
Calculate the total change in income. If the change is negative, enter answer using a minus sign. $_________ 3. Calculate the change in profits attributable to productivity changes. If the change is negative, enter answer using a minus sign. If required, round your intermediate calculations to the nearest dollar. $_________ 4. Calculate the price-recovery component. If required, round your intermediate calculations to the nearest dollar. $________
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