5e sol15-09

# 5e sol15-09 - \$7,560,000 Change in income = \$2,460,000 3...

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Cost Management Hansen and Mowen Ex 15-9 Name: SOLUTION Enter the appropriate numbers in the shaded cells in columns D, F, K, and M. 1) Productivity Input Output / Input ratio Base Year Materials 900,000 / 1,200,000 = 0.75 Labor 900,000 / 300,000 = 3.00 Productivity Input Output / Input ratio Current Year Materials 1,080,000 / 1,080,000 = 1.00 Labor 1,080,000 / 540,000 = 2.00 2) Base Year Current Year units price units price Sales 900,000 \$15 \$13,500,000 1,080,000 \$15 \$16,200,000 Less: Input costs Materials 1,200,000 x \$5 6,000,000 720,000 x \$6 4,320,000 Labor 300,000 x \$8 2,400,000 540,000 x \$8 4,320,000 Gross profit \$5,100,000
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Unformatted text preview: \$7,560,000 Change in income = \$2,460,000 3) Current Base Input Output / Ratio = PQ Current Year Materials 720,000 / 0.75 = 960,000 Labor 720,000 / 3.00 = 240,000 Input PQ x P PQ x P AQ x P AQ x P Change Materials 1,440,000 x \$6.00 = \$8,640,000 1,080,000 x \$6.00 = \$6,480,000 \$2,160,000 Labor 360,000 x \$8.00 = 2,880,000 540,000 x \$8.00 = 4,320,000 (1,440,000) \$11,520,000 \$10,800,000 \$720,000 4) Price recovery component: Change in income \$2,460,000 Change attributable to productivity 720,000 Price recovery component \$1,740,000...
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