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Problem number 5 Industrial Operations Management Academic Number: Name: Exercise 1: Erie Precision Tool Company manufactures drill bits, and its operating information for 2006 and
Problem number 5 Industrial Operations Management Academic Number: Name: Exercise 1: Erie Precision Tool Company manufactures drill bits, and its operating information for 2006 and 2007 is provided 2007 2006 Units of DB2 manufactured and sold 5900 5400 Total sales (price is $550) Direct materials (33,000 @ $33; 28,000 @ $29) Direct labor (6,000 @$45; 6,000 @$40) Other operating costs 250000 250000 Operating income Question: Did productivity decline? 1. Partial Productivity for DB2 2006 2007 Operational Partial Productivity Direct materials (DM) Direct labor (DL) Financial Partial Productivity Direct materials (DM) Direct labor (DL) 2. Total Productivity for DB2 a. Total productivity in units 2006 2007 (a) Total units manufactured (b) Total variable manufacturing costs incurred Total productivity Productivity rate b. Total productivity in sales dollars 2006 2007 (a) Total sales (b) Total variable manufacturing costs incurred Total productivity Productivity rate Fathi SMAILI 1
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