Question: Question 1 (Total 20 marks) Tommy is the operations manager of ABC Co. Ltd. making leather soccer balls for children, and with recent trend of



Question 1 (Total 20 marks) Tommy is the operations manager of ABC Co. Ltd. making leather soccer balls for children, and with recent trend of cost increase, he wishes to look into the productivity of his company. He would like to know if his company is having a 5% increase in productivity in order to be qualified for a productivity improvement bonus. Please see the annual figures below: Year 2018/19 Year 2019/20 Unit Produced 5,000,000 5,000,000 Labour (hours) 900,000 810,000 100,000,000 110,000,000 Capital Invested ($) Materials (Ton) 2,400 2,280 The details of the various cost items are: $40 per labour hour and $18 per kg of materials. While for the capital expense, it is at 0.9% per month of capital investment 1(a). Calculate the productivity percentage (correct to 1 decimal place) change for each category in the table below (9 marks). Some answers have been shown for your reference, Format B 1 Yr 2018/19 Yr 2019/20 Unit Cost Unit lor Produced Rate 5,000,000 5,000,000 Monthly Monthly Productivity Cost Cost Change (%) 2018/19 2019/20 (state + or -] Labour (hours) 40 3,000,000 900,000 810,000 Capital Invested 990,000 0.9% 100,000,000 110,000,000 Materials (Ton) 18 3,600,000 2,400 2,280 Sub-total 1(b). Will Tommy get his productivity improvement bonus for Year 2019/20? Why? (2 marks)
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