Table 1.3 The Abco Company Manufactures Electrical Assemblies.The Current Process Uses 10

Essay

Table 1.3
The Abco Company manufactures electrical assemblies.The current process uses 10 workers and produces 200 units per hour.You are considering changing the process with new assembly methods that increase output to 300 units per hour,but will require 14 workers.Particulars are as follows:
Workers are paid at a rate of $10 per hour,and overhead is charged at 140% (or 1.4 times)labor costs.Finished switches sell for $20/unit.
a.Calculate the multifactor productivity for the current process.
b.Calculate the multifactor productivity for the new process.
c.Determine if the new process should be implemented.
-The three person crew worked their way through the neighborhood,mowing lawns,edging,apply fertilizer and weed treatments where necessary and collecting all the clippings for use as mulch as part of their new green initiative.Their pricing scheme appears in Table A and the mix of orders and service costs appear in Table B:
a.What is their multifactor productivity for these orders in the prestigious Edmond Oaks neighborhood?
b.Which of the service combinations they are providing is their most productive from a multifactor perspective?
c.What is their labor productivity for the same mix of orders?
Table A: Price List:
Workers are paid at a rate of $10 per hour,and overhead is charged at 120% (or 1.2 times)labor costs.For a customer that gets both mowing and edging,their $95 bill would be discounted for two services times 5% for a total of 10% off the $95 straight charge for a cost of $85.50.A customer receiving three services would get a 15% discount off their service bill.Labor hours shown in Table A are total hours for the three-person crew.
Table B: Orders Processed