Mack's guitar fabrication shop produces low cost, highly durable guitars for beginners. Typically, out of the...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Mack's guitar fabrication shop produces low cost, highly durable guitars for beginners. Typically, out of the 100 guitars that begin production each month, only 82 percent are considered good enough to sell. The other 18 percent are scrapped due to quality problems that are identified after they have completed the production process. Each guitar sells for $260. Because some of the production process is automated, each guitar only requires 10 labor hours. Each employee works an average of 160 hours per month. Labor is paid at $10 per hour, materials cost is $42 per guitar, and overhead is $4,000. a. The labor productivity ratio for Mack's guitar fabrication shop is $ 21.32 per hour. (Enter your response rounded to two decimal places.) The multifactor productivity ratio for Mack's guitar fabrication shop is 1.17. (Enter your response rounded to two decimal places.) b. After some study, the operations manager Darren Funk recommends 3 options to improve the company's multifactor productivity: > Option 1: increase the sales price by 15 percent > Option 2: improve quality so that only 15 percent are defective, or > Option 3: reduce labor, materials, and overhead costs by 15 percent. If Mack's guitar fabrication shop decides to implement Darren Funk's option 1 to improve the multifactor productivity, the new productivity level would be (Enter your response rounded to two decimal places.) Mack's guitar fabrication shop produces low cost, highly durable guitars for beginners. Typically, out of the 100 guitars that begin production each month, only 82 percent are considered good enough to sell. The other 18 percent are scrapped due to quality problems that are identified after they have completed the production process. Each guitar sells for $260. Because some of the production process is automated, each guitar only requires 10 labor hours. Each employee works an average of 160 hours per month. Labor is paid at $10 per hour, materials cost is $42 per guitar, and overhead is $4,000. a. The labor productivity ratio for Mack's guitar fabrication shop is $ 21.32 per hour. (Enter your response rounded to two decimal places.) The multifactor productivity ratio for Mack's guitar fabrication shop is 1.17. (Enter your response rounded to two decimal places.) b. After some study, the operations manager Darren Funk recommends 3 options to improve the company's multifactor productivity: > Option 1: increase the sales price by 15 percent > Option 2: improve quality so that only 15 percent are defective, or > Option 3: reduce labor, materials, and overhead costs by 15 percent. If Mack's guitar fabrication shop decides to implement Darren Funk's option 1 to improve the multifactor productivity, the new productivity level would be (Enter your response rounded to two decimal places.)
Expert Answer:
Posted Date:
Students also viewed these general management questions
-
Assume FCFs are $2 million for two years (FCF1 and FCF2) and FCFs grow 3% thereafter. Assume WACC = 7%. Calculate firms value
-
After recording the transactions in E 9, prepare a trial balance for Change Repair Service, Inc., as of June 30, 2011. In E 9, a. Michael Change opened Change Repair Service, Inc., by investing...
-
(a) What are discontinued operations? (b) What is a component of an entity?
-
Match each of the numbered transactions to the accounting terms A through F applicable to recording and reporting them. A. Business entity assumption B. Reliability C. Cost principle D. Going-concern...
-
In March 2014, Grackle, Inc., acquired used equipment for its business at a cost of $300,000. The equipment is five-year class property for regular income tax purposes and for AMT purposes. Grackle...
-
pok int The standard cost card for a unit of Product AX at the Cleaning Chemicals Corp. shows the following standard cost information: Materials: 2 gallons at $14 per gallon Labor: 3 hours at $10 per...
-
Davies Corporation has 540,000 common shares outstanding. The corporation declares a 8% stock dividend at the common shares fair value of $26 per share. (Their carrying value is $20 per share.)...
-
At gunpoint, a convenience shop was robbed in the middle of the day. The culprit was seen on the store's security camera, and a composite sketch was created from the footage. The owner of the...
-
Assume Ganado enters into a swap agreement to receive euros and pay Japanese yen, on a notional principal of 5,000,000. The spot exchange rate at the time of the swap is 104/. (When you answer the...
-
Carefully read the case, making sure you understand it fully; Step 2: Identify the area of law involved and the legal issue(s) presented; Step 3: Set out the elements or requirements that must be...
-
Find a negligence case from that same jurisdiction. The case you find should: Have facts similar to a case cited in that post. Have a finding that is DIFFERENT from the case cited in that post....
-
Consider the Markov Chain, Xn, on the states i = 0, 1, 2, . . . with transition matrix given by pi,i1 = p i = 1, 2, . . . pi,i+1 = 1 p i = 0, 1, . . . p0,0 = p where 0 < p < 1. (i) Show that the...
-
Question 4 / Vraag 4 Given that / Gegee dat: If / As|A| = K then / dan is - (a) 2K (e) K (b) -2K ()-K 2p 1 2 2q 1 4 2r 1 6 www 12 p 229 32 r (c) K (d) - K (g) None of these / Geen van hierdie
-
An access route is being constructed across a field (Figure Q8). Apart from a relatively firm strip of ground alongside the field's longer side AB, the ground is generally marshy. The route can...
Study smarter with the SolutionInn App