Cost Management 6th Edition by Edward Blocher,David Stout ,Paul Juras,Gary Cokins

Exercise 27

Partial Operational Productivity Hadley 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. Hadley's operating data for 2012 and 2013 follow:

Required
1. Compute the partial operational productivity for 2012 and 2013.
2. On the basis of the partial operational productivity that you computed, what conclusions can you draw about the firm's productivity in 2013 relative to 2012