Basics of Productivity Measurement
Holbrook Company gathered the following data for the past twoyears:
| Base Year | Current Year |
| Output | 910,000 | 1,080,000 |
| Output prices | $14 | $14 |
| Input quantities: | | |
| Materials (lbs.) | 182,000 | 1,080,000 |
| Labor (hrs.) | 91,000 | 540,000 |
| Input prices: | | |
| Materials | $4 | $5 |
| Labor | $8 | $8 |
Required:
1. Prepare a productivity profile for eachyear. If required, round your answers to two decimal places.
|
| Holbrook Company |
| Productivity Profile |
| Base Year | Current Year |
| Materials productivity ratio | | |
| Labor productivity ratio | | |
2. Prepare partial income statements for eachyear.
|
| Holbrook Company |
| Partial Income Statements |
| Base Year | Current Year |
| Sales | $ | $ |
| Materials | | |
| Labor | | |
| Gross profit | $ | $ |
Calculate the total change in income. If the change is negative,enter answer using a minus sign.
$
3. Calculate the change in profits attributable toproductivity changes. If the change is negative, enter answer usinga minus sign. If required, round your intermediate calculations tothe nearest dollar.
$
4. Calculate the price-recovery component. Ifrequired, round your intermediate calculations to the nearestdollar.
$
