PLEASE TYPE AND EXPLAIN YOUR WORK

CASTLETON CHEMICALS Sam Gabriel, the production manager of Castleton Chemicals is preparing his quarterly report, which is to include a productivity analysis for his department. One of the inputs is production data prepared by Charlotte Young, his operations analyst. The report, which she gave him this morning, showed the following: Production (units) Raw Materials used (barrels of petroleum by-products Labor hours Capital cost applied to the department ($) 2019 2020 4,500 6,000 700 900 22,000 28,000 375,000 620,000 Sam knew that his labor cost per hour had increased from an average of $13 per hour to an average of $14 per hour, primarily due to a move by management to become more competitive with a new company that have just opened a plant in the area. He also knew that his average cost per barrel of raw materials had increased from $320 to $360. He was concerned about the accounting procedures that increased his capital cost from $375,000 to $620,000, but earlier discussions with his boss suggested that there was nothing that could be done about the allocation. Sam wondered if his productivity has increased at all, He called Charlotte into his office and conveyed the above information to her and asked her to prepare this part of the report. . . Prepare the productivity part of the report for Mr. Gabriel. He probably expects some analysis of productivity inputs for all factors, as well as a multifactor analysis for both years with the change in productivity (up or down) and the amount noted. Management's expectation for departments such as Mr. Gabriel's is an annual productivity increase of 5%. Did he reach his goal? The producer price index had increased from 120 to 125, and this fact seemed to indicate to Mr. Gabriel that his costs were too high. What do you tell him are the implications of this change in the producer price index