Question: A company has introduced a process improvement that reduces processing time for each unit, so that output is increased by 20% with less material, but

A company has introduced a process improvement that reduces processing time for each unit, so that output is increased by 20% with less material, but one additional worker required. Under the old process, five workers could produce 60 units per hour. Labor costs are $12/hour, and material input was previously $16/unit. For the new process, material is now $10/unit. Overhead is charged at 1.6 times direct labor cost. Finished units sell for $31 each. What increase in productivity is associated with the process improvement?

Step by Step Solution

★★★★★

3.24 Rating (165 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Labor Productivity No of output units no of workers Old Process 5 workers are producing 60 units per ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

1019-B-C-A-C-P-A(2363).docx

120 KBs Word File

Students Have Also Explored These Related Cost Accounting Questions!

Reliable Security Devices (RSD) has introduced a just-in-time production process and is considering the adoption of lean accounting principles to support its new production philosophy. The company...

Flexible Security Devices (FSD) has introduced a just-in-time production process and is considering the adoption of lean accounting principles to support its new production philosophy. The company...

LockTite (LT) has introduced a just-in-time production process and is considering the adoption of lean accounting principles to support its new production philosophy. The company has two product...

The manager of a carpet store is trying to determine optimal installation crew size. He has tried various crew sizes with the results shown below. Compute the average labour productivity for each...

Mahmoudco Fizzy Drinks had the following demand schedule for its products over the past months: Period Demand January 7300 February 7450 March 7250 April 7500 May 7970 June 8000 July 8200 August a....

A company has introduced a process improvement that reduces processing time for each unit, so that output is increased by 2 5 % with less material, but one additional worker required. Under the old...

A company has introduced a process improvement that reduces processing time for each unit, so that output is increased by 25% with less material, but one additional worker required. Under the old...

A company has introduced a process improvement that reduces processing time for each unit, so that output is increased by 3 5 % with less material, but one additional worker required. Under the old...

I'm sorry if this is a few questions at once, I just figured it made more sense this way since each question carries on from the last. If you'd prefer I upload them individually I can do that too :)...

What is an industrial robot?

return on this type of treasury security is often cited as an indicator of the country's overall macroeconomic health. a . 1 - year Treasury note b . 1 0 - year Treasury note c . Treasury bill d . 5...

9. Sabine cant tell the difference between Coke and Pepsithe two taste exactly the same to her. a. What is Sabines marginal rate of substitution of Coke in place of Pepsi? b. Draw a few of Sabines...

A series of water-filled trays, each 222 mm long, experiences an evaporative drying process. Dry air at T = 300 K flows over the trays with a velocity of 15 m/s, while radiant heaters maintain the...

Consider the physical system of Problem 7.109 la series of water-filled trays heated radiatively), but under operating conditions for which each tray is 0.25 m long by 1 m wide and is uniformly...

Please help me only with question 1 parts F and G. I have included the rest of the parts of the question for reference only if needed to answer parts F and G. I have included a picture and a link to...

Problem 1 An electrical rm manufactures light bulbs that have a length of life that is approximately normally distributed with a standard deviation of 25 hours. If a sample of 35 bulbs has an average...

Question 2: Adjusted case count for pre-school age children: Question 3: Adjusted case count for school-age children: Question 4: Adjusted case count for adults: Question 5: Adjusted total case...