Use the data for Ashley Technology Inc. in Problem 16-41 to complete the following requirements. Also assume that fixed manufacturing costs are $50 million in both 2021 and 2022.

Required

1. Compute the total productivity ratios for 2021 and 2022.

2. On the basis of the total productivity that you computed, what conclusions can you draw about the firm’s productivity in 2022 relative to 2021?

Problem 16-41

Ashley Technology Inc. manufactures a scrambling device for cellular telephones. The device’s main component is a delicate part, CT140. CT140 is easily damaged and requires careful handling. Once damaged, it must be discarded. The firm hires only skilled laborers to manufacture and install CT140; however, some are still damaged. Robotic instruments process all other parts. Ashley’s operating data for 2 years are as follows:

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2022 2021 750,000 900,000 150,000 $156 $56 Units manufactured 1,000,000 Number of CT140 used Number of direct labor hours spent Cost of CT140 per unit Direct labor wage rate per hour 1,050,000 200,000 $135 $62