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Sheet 1 - Productivity

1. Bluegill Furniture produces chairs with a total weekly output value of $14,280 and total input costs of $16,528, giving it a total productivity measure of -$2,248. The new sanding machine has a productivity of 17 chairs per 8 hours. The two new painters have a labor productivity of 10 chairs per 4 hours. With costs and sales figures given, Bluegill's multifactor productivity is $35 per chair. Last week's labor productivity was 34 chairs per 200 hours worked. Compared to the previous week's $15 in sales per hour, labor productivity decreased. 2. Aztec Furnishings installed a new assembly process that increased daily production from 60 to 90 pieces while

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229 views2 pages

Sheet 1 - Productivity

1. Bluegill Furniture produces chairs with a total weekly output value of $14,280 and total input costs of $16,528, giving it a total productivity measure of -$2,248. The new sanding machine has a productivity of 17 chairs per 8 hours. The two new painters have a labor productivity of 10 chairs per 4 hours. With costs and sales figures given, Bluegill's multifactor productivity is $35 per chair. Last week's labor productivity was 34 chairs per 200 hours worked. Compared to the previous week's $15 in sales per hour, labor productivity decreased. 2. Aztec Furnishings installed a new assembly process that increased daily production from 60 to 90 pieces while

Uploaded by

lovely_mhmd
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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POM – Sheet 1 – Productivity

1. Bluegill Furniture is a small furniture shop that focuses on making kitchen chairs. The
weekly dollar value of its output, including finished goods and work in progress, is
$14,280. The value of inputs, such as labor, materials, and capital, is approximately
$16,528.
a) Compute the total productivity measure for Bluegill Furniture.
b) If Bluegill has just purchased a new sanding machine that processes 17 chairs in 8
hours. What is the productivity of the sanding machine?
c) Bluegill has hired two new workers to paint chairs. They have painted 10 chairs in 4
hours. What is their labor productivity?
d) On average, Bluegill produces 35 chairs per day. Labor costs average $480, material
costs are typically $200, and overhead cost is $250. If Bluegill sells the chairs to a
retailer for $70 each, determine the multifactor productivity.
e) Last week employees at Bluegill produced 46 chairs after working a total of 200 hours.
Of the 46 chairs produced, 12 were damaged due to a problem with the new sanding
machine. The damaged chairs can be discounted and sold for $25 each. The
undamaged chairs are sold to a department store retail chain for $70 each. What was
the labor productivity ratio for last week? If labor productivity was $15 in sales per
hour the previous week, what was the change in labor productivity?

2. Aztec Furnishings makes hand-crafted furniture for sale in its retail stores. The furniture
maker has recently installed a new assembly process, including a new sander and polisher.
With this new system, production has increased to 90 pieces of furniture per day from the
previous 60 pieces of furniture per day. The number of defective items produced has
dropped from 10 pieces per day to 1 per day. The production facility operates strictly eight
hours per day. Evaluate the change in productivity for Aztec using the new assembly
process.

3. Howard Plastics produces plastic containers for use in the food packaging industry. Last
year its average monthly production included 20,000 containers produced using one shift
five days a week with an eight-hour-a-day operation. Of the items produced 15 percent
were deemed defective. Recently, Howard Plastics has implemented new production
methods and a new quality improvement program. Its monthly production has increased
to 25,000 containers with 9 percent defective.
a) Compute productivity ratios for the old and new production system.
b) Compare the changes in productivity between the two production systems.

4. Med-Tech labs is a facility that provides medical tests and evaluations for patients, ranging
from analyzing blood samples to performing magnetic resonance imaging (MRI). Average
cost to patients is $60 per patient. Labor costs average $15 per patient, materials costs
are $20 per patient, and overhead costs are averaged at $20 per patient.
a) What is the multifactor productivity ratio for Med-Tech? What does your finding
mean?
b) If the average lab worker spends three hours for each patient, what is the labor
productivity ratio?
5. Handy-Maid Cleaning Service operates five crews with three workers per crew. Different
crews clean a different number of homes per week and spend a differing amount of hours.
All the homes cleaned are about the same size. The manager of Handy-Maid is trying to
evaluate the productivity of each of the crews. The following data have been collected
over the past week. Assuming the quality of cleaning was consistent between crews,
which crew was most productive?
WORK CREW HOURS HOMES CLEANED
ANNA, SUE, AND TIM 35 10
JIM, JOSE, AND ANDY 45 15
DAN, WENDY, AND CARRY 56 18
ROSIE, CHANDRA, AND SETH 30 10
SHERRY, VICKY, AND ROGER 42 18

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