University:
California State University, Northridge
Course:
ACCT 220 | Introduction to Financial Accounting
Academic year:

2024
Views:

241

Pages:

11
Author:

Travis Ballard

1 Productivity Outputs Productivity = Inputs • Single-factor measures – Output / (Single Input) • All-factors measure – Output / (Total Inputs) 2 Measures of Productivity Single-factor Output measures Labor All-factors measure Output Machine Output Capital Output Energy Output All inputs 3 Single Factor Single-factor Output measures Labor Output Machine Output Capital Output Energy If we produce only one product, the numerator can be either the total units of the product or the total $ value of the product. If we produce several products, the numerator is the total $ value of all products. The denominator can be the units of input or the total $ value of input. 4 Example: Single Factor Productivity 10,000 Units Produced Sold for $10/unit 500 labor hours Labor rate: $9/hr What is the labor productivity? 5 Example: Labor Productivity • 10,000 units / 500hrs = 20 units/hr • (10,000 units * $10/unit) / 500hrs = $200/hr • 10,000 units / (500hrs * $9/hr) = 2.2 unit/$ • (10,000 units * $10/unit) / (500hrs * $9/hr) = 22.22 •The last one is unit-less 6 Some Single Factor Measurements • Labor Productivity – Quantity (or value) of output / labor hrs – Quantity (or value) of output / shift • Machine Productivity – Quantity (or value) of output / machine hrs • Energy Productivity – Quantity (or value of output) / kwh • Capital Productivity – Quantity (or value) of output / value of input 7 All Factors All-factors measure Goods or Services produced All inputs used to produce them If we produce only one product, the numerator can be either the total units of product or total $ value of the product. If we produce several products, the numerator is the total $ value of all products. Usually, the numerator is the total $ value of all outputs. The denominator is total $ value of all inputs. 8 Example 10,000 Units Produced Sold for $10/unit 500 labor hours Labor rate: $9/hr Cost of raw material: $30,000 Overhead: $15,500 9 Example : All-Factor Productivity AFP = AFP = Output Labor + Materials + Overhead (10,000 units) * ($10) (500)*($9) + ($30,000) + ($15,500) AFP = 2.0 10 What are the factors that affect productivity? Training Technology Methods Management 11

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