Question 2 (20 Marks) Mr Khumalo, the managing director of a Petrochemicals manufacturing company in South...
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Question 2 (20 Marks) Mr Khumalo, the managing director of a Petrochemicals manufacturing company in South Africa, is preparing his quarterly report, which is to include a productivity analysis for his company. One of the inputs is production data prepared by Mr Nelson, his operations analyst. The report which he gave him this morning showed the following as highlighted in table below: Year Production units 2019 10000 2020 12000 Raw materials (barrels of petroleum by 1000 produscts 1200 Labour hours Capital costs 30000 R500000 35000 R700000 Mr Khumalo knew that his labour cost per hour had increased from an average of R15 per hour to an average of R17 per hour, primarily due to a move by management to become more competitive with a new company that had just opened a plant in the area. He also knew that his average cost per barrel of raw material had increased from R400 to R450. He was concerned about the accounting procedures that increased his capital cost from R 500000 to R700000, but earlier discussions with his boss suggested that there was nothing that could be done about that allocation. Mr Khumalo wondered if his productivity had increased at all. He called Nelson into the office and conveyed the above information to him and asked him to prepare this part of the report. Using a table, provide a detailed calculation of single productivity analysis and multifactor productivity. Question 2 (20 Marks) Mr Khumalo, the managing director of a Petrochemicals manufacturing company in South Africa, is preparing his quarterly report, which is to include a productivity analysis for his company. One of the inputs is production data prepared by Mr Nelson, his operations analyst. The report which he gave him this morning showed the following as highlighted in table below: Year Production units 2019 10000 2020 12000 Raw materials (barrels of petroleum by 1000 produscts 1200 Labour hours Capital costs 30000 R500000 35000 R700000 Mr Khumalo knew that his labour cost per hour had increased from an average of R15 per hour to an average of R17 per hour, primarily due to a move by management to become more competitive with a new company that had just opened a plant in the area. He also knew that his average cost per barrel of raw material had increased from R400 to R450. He was concerned about the accounting procedures that increased his capital cost from R 500000 to R700000, but earlier discussions with his boss suggested that there was nothing that could be done about that allocation. Mr Khumalo wondered if his productivity had increased at all. He called Nelson into the office and conveyed the above information to him and asked him to prepare this part of the report. Using a table, provide a detailed calculation of single productivity analysis and multifactor productivity.
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