As the cost accounting manager at Cambria Chemicals (CC), you are responsible fo

Question

As the cost accounting manager at Cambria Chemicals (CC), you are responsible for compiling and reporting various performance measures to the senior managers. The company instituted many efficiency improvement programs recently, and the CFO has asked you to measure and report total factor productivity measures based on the three inputs (material, labor, and overhead). Data for the last two years follow: Gallons input (thousands) Labor-hours (thousands) Gallons of output (thousands) Year 2 Year 1 9,9008,900 9,100 6,700 11,700 9,700 From the accounting records, you also gather the following information for the two years Year 2 Year 1 Cost of inputs (per gallon) Wage rate (per hour) Total manufacturing overhead Selling price of output (per gallon) 84 $ 24 $ $1,330,000 $1,160,000 79 380 $ 385 Required a. Compute the total factor productivity measures for year 1 and year 2 based on the three inputs (material, labor, and overhead). (Round your answers to 3 decimal places.) Year 2 Year Total factor productivity

Explanation / Answer

1). Calculation for Total Productivity Value :-

2).

Particulars Year 1 Year 2 Value of Output $3734500 $4446000 (9700 * $385) (11700 * $380) Value of Input :- Material Value $703100 $831600 (8900 * $79) (9900 * $84) Labor Value $107200 $218400 (6700 * $16) (9100 * $24) Overhead Value $1160000 $1330000 Total Input Value $1970300 $2380000 Total Factor Productivity (Total Output Value / Total Input Value ) 1.895 1.868

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