Question: Hey I would really appreciate your help on the steps required to answer this question but with other numbers when I have my in-class assessment.
Hey I would really appreciate your help on the steps required to answer this question but with other numbers when I have my in-class assessment. Thank you for your help in advance! Note, the other answers to this question on chegg seem to be incorrect according to my prof. Please focus on explaining E in full to establish a formula for the same question with different numbers. Thank you, Ill be sure to review and up-vote your help.
1) (20 points) A crock pot manufacturer is considering a location in Ontario and another in Vietnam. Either plant will produce 2,000 crock pots per week. The fixed setup costs for both plants are identical. The Ontario plant can produce 2,000 crock pots per week. The plant works one 7.5 hour shift per day with 4 staff. The plant works 5 days per week. The average wage is $21 per hour. The plant would use 1,600 units of inputs and can buy inputs at $4 per unit. Based on location and staffing levels, the plant would be assigned an overhead allocation of $2,500 per week. The Vietnam plant can produce 2,000 crock pots per week. The plant works one 12 hour shift per day with 7 staff. The plant works 6 days per week. The average wage is $8 per hour. The plant would use 1,600 units of input to make the crock pots and can buy inputs at $3.50 per unit. Based on location and staffing levels, the plant would be assigned an overhead allocation of $3,000 per week. a) What is the total cost of production for a week at each plant? What is the cost per crock pot? What is the labour cost per crock pot? b) Calculate and compare the labour productivity of the two options. Which one is better? c) Calculate and compare the multi-factor (labour, input and overhead) productivity of the two options. Which location is preferred? d) Give two other factors that the management team should consider before choosing a location (there may be more than 2 but only 2 are required). e) The Ontario plant's manager believes he can increase labour productivity per hour by 12% by increasing wages to $24 per hour. How many crock pots can they now make in a week? What is the total labour cost per crock pot and total cost per crock? How much have each improved
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