2018 2019 Output (units)120,000126,000Selling price per unit$25.00$25.00 Input quantities: Materials (pounds)6,0006,000Labor (hours)4,8004,875 Input prices: Materials (per pound)$5.00$5.50Labor (per hour)7.007.50By how much did profits change as a result of changes in productivity related to labor?a. $1,650.00 increaseb. $1,237.50 decreasec. $1,237.50 increased. $1,650.00 decrease

Productivity changes in labour can be influenced by various factors such as technological…

Answered: 2018 2019 Output (units)…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter12: Activity-based Management

Section: Chapter Questions

Problem 19E: A company is spending 70,000 per year for inspecting, 60,000 per year for purchasing, and 56,000 per...

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2018	2019
Output (units)	120,000	126,000
Selling price per unit	$25.00	$25.00

Input quantities:
Materials (pounds)	6,000	6,000
Labor (hours)	4,800	4,875

Input prices:
Materials (per pound)	$5.00	$5.50
Labor (per hour)	7.00	7.50

By how much did profits change as a result of changes in productivity related to labor?

a. $1,650.00 increase

b. $1,237.50 decrease

c. $1,237.50 increase

d. $1,650.00 decrease

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