Partial Operational and Financial Productivity; Total Productivity Katrina Design hasdecided to experiment with two alternative manufacturing approaches, identified as MF and LI,for producing men’s fashions. The firm expects the total demand to be 20,000 suits. Managementestimates the required input resources using the different manufacturing approaches are:Direct Materials (yards) Direct Labor (hours)MF 240,000 100,000LI 180,000 120,000The cost of direct materials is $10 per yard; the cost of direct labor is $26 per hour.Required In your calculations, use 4 significant digits after the decimal point.1. Compute the partial operational productivity ratios for each of the production approaches. Whichapproach would you select based on the partial operational productivity ratios?2. Calculate the partial financial productivity ratios for each of the production approaches. Which approachwould you select based on the partial financial productivity ratios?3. Compute the total productivity ratios for each of the production approaches. Which approach would youselect based on the total productivity ratios?
Partial Operational and Financial Productivity; Total Productivity Katrina Design has
decided to experiment with two alternative manufacturing approaches, identified as MF and LI,
for producing men’s fashions. The firm expects the total demand to be 20,000 suits. Management
estimates the required input resources using the different manufacturing approaches are:
Direct Materials (yards) Direct Labor (hours)
MF 240,000 100,000
LI 180,000 120,000
The cost of direct materials is $10 per yard; the cost of direct labor is $26 per hour.
Required In your calculations, use 4 significant digits after the decimal point.
1. Compute the partial operational productivity ratios for each of the production approaches. Which
approach would you select based on the partial operational productivity ratios?
2. Calculate the partial financial productivity ratios for each of the production approaches. Which approach
would you select based on the partial financial productivity ratios?
3. Compute the total productivity ratios for each of the production approaches. Which approach would you
select based on the total productivity ratios?
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