At the End of 2018, Diatomic Company Implemented a New

question 40

Multiple Choice

At the end of 2018, Diatomic Company implemented a new labor process and redesigned its product with the expectation that input usage efficiency would increase. Now, at the end of 2019, the president of the company wants an assessment of the changes on the company's productivity. The data needed for the assessment are as follows: $\begin{array}{lrr}&2019&2018\\\text { Output } & 45,000 & 54,000 \\\text { Output prices } & \$ 10 & \$ 10 \\\text { Materials (lbs.) } & 22,500 & 22,950 \\\text { Materials unit price } & \$ 3 & \$4 \\\text { Labor (hrs.) } & 18,000 & 16,875 \\\text { Labor rate per hour } & \$ 5 & \$ 5 \\\text { Power (kwh) } & 11,250 & 14,625 \\\text { Price per kwh } & \$ 2 & \$ 3\end{array}$
How much profit was generated in 2019?

• A)$540,000
• B)$319,950
• C)$220,050
• D)$270,000

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