Productivity: Exponential Smoothing and Marks

Topics: Exponential smoothing, Moving average, Average Pages: 4 (709 words) Published: December 6, 2012

Fall Nov_2012

Name: --------------------------------------------------------------------------------------------------- | | | | |Production (units) |4,500 |6,000 | |Raw material used (barrel of petroleum by-products) |700 |900 | |Labor hour |22,000 |28,000 | |Capital cost applied to the department ($) |375,000 |620,000 |

Bob new the his labor cost per hour has increased from 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 had just opened a plant in the area. He also knew that his average cost per barrel of new material had increased from $320 to $360. He was concerned about the accounting procedure that increased his capital cost from $375,000 to $620,000, but earlier discussions with boss suggested that there was nothing that could be done about the allocation.

Bob wanted if his productivity had increased at all. He called Sharon and conveyed the above information to her and asked her to prepare this part of the report.

Discussion Question;

Prepare the productivity part of the report for Mr Richards. 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.

Solution Q 1 [20 marks]...
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