An Australian company has two manufacturing plants, one in Australia and the other in a Southeast Asian country. Both produce the same product, each for sale in their respective countries. However, their labour productivity and capital productivity figures are quite different. The analyst thinks this is because the Australian plant uses more automated equipment for processing while the other plant uses a higher percentage of labour. In your own words, explain how the aforementioned factors can cause productivity figures to be misleading. Is there another way to compare the two plants that would be more meaningful?

An Australian company has two manufacturing plants, one in Australia and the other in a Southeast Asian country. Both produce the same product, each for sale in their respective countries. However, their labour productivity and capital productivity figures are quite different. The analyst thinks this is because the Australian plant uses more automated equipment for processing while the other plant uses a higher percentage of labour. In your own words, explain how the aforementioned factors can cause productivity figures to be misleading. Is there another way to compare the two plants that would be more meaningful?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

The Benefits and Costs of Decentralized Decision Making. Centralizing as a Cost-Cutting Approach One of the disadvantages of decentralization discussed in the text is the possibility of increased costs (perhaps because of duplication of effort) that can occur. Some firms have realized this and have centralized certain functions. For example, Pernod Ricard SA (a French beverage company) purchases casks for many of its different products. Initially, casks were purchased separately for each of the brands. However, the company decided to centralize the purchase of casks from a central location in the U.S. The move ...helped the company shave off 2% to 3% of expenses tied to indirect procurement... Other companies that have centralized certain business activities include PayPal, Incorporated and the Royal Bank of Canada. In addition to the savings from centralizing the service function, Many companies also opt to place these hubs offshore in lower-cost countries, which can save 20% to…
Which of the following statements is not correct regarding Local Plus? - Local Plus is especially suited to middle management who show willingness to relocate. - Local Plus is a hybrid version of the balance sheet (home-based) and going rate (host-based) approaches. - Local Plus is used for long-term assignments. - Local plus is the driving force behind cost savings in international assignments. - Local plus is especially suited for temporary transfers.
Which of the following create value in an industry? (Select all that apply.) When value capture increases O When aggregate production in an industry increases. When a firm exits an industry When the industry demand curve shifts outward When a firm enters an industry with an undifferentiated product
Hi, I also need help finding the lowest acceptable transfer price as well as the highest acceptable transfer price. thanks
Tourism industry is one of the rapid growing industries around the globe. The boom of mass tourism at the twentieth century becomes widespread with the alternative tourism attendance. The conditions today forcing touristic destinations and tourism enterprises for challenging. This competition pressure affecting the choices and activities of the enterprises. Thus, the importance of utilizing the resources more efficient and effective becomes increased. Therefore, enterprises should more emphasis on cost management systems. Questions for Discussion: a. How cost accounting helps tourism firm in determining the price? b. Which kind of decision can be taken by tourism firm using cost accounting method? c. Which technique of costing can be used in tourism firm and why that technique can be used? d. What are the benefits enjoyed by tourism firm by adopting cost accounting?
Can you help me do this quickly, thanks a. The constraint at Shanghai Company is an expensive milling machine. The three products listed below use this constrained resource.Required (show your calculations):i. Rank the products in order of their current profitability from the most profitable to the least profitable. ii. Assume that sufficient constraint time is available to satisfy the demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of the constrained resource. Explain your answer.
Competitors often inquire about the price of a competitive product. A firm called iSuppli will breakdown complex electronics for a fee and tell you how much it would cost to duplicate the device. The difference between the costs of the pairs and the labor costs to put the components together isn't entirely profit. Non-production expenses include things like research, design, marketing, patent fees, and selling. What are the types of costs associated with research, design, marketing, patent fees, and selling, and how are they accounted for?
For each of the following items, identify which of the management accounting guidelines applies: cost-benefit approach, behavioral and technical considerations, or different costs for different purposes. Analyzing whether to keep the billing function within an organization or outsource it Deciding to give bonuses for superior performance to the employees in a Japanese subsidiary and extra vacation time to the employees in a Swedish subsidiary Including costs of all the value-chain functions before deciding to launch a new product, but including only its manufacturing costs in determining its inventory valuation Considering the desirability of hiring one more salesperson Giving each salesperson the compensation option of choosing either a low salary and a high-percentage sales commission or a high salary and a low-percentage sales commission Selecting the costlier computer system after considering two systems Installing a participatory budgeting system in which managers set…
Competitors often inquire about a competitor's product's price. For a fee, iSuppli will deconstruct complex electronics and estimate the cost of duplicating the product. The difference between the pair's cost and the labor cost to put the pieces together isn't all profit. Research, design, marketing, patent fees, and selling charges are examples of non-production expenditures. What are the many types of costs, such as research, design, marketing, patent fees, and selling costs, and how are they addressed in accounting?

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS