Labor Productivity Is Measured by the Average Product of Labor;

question 64

Multiple Choice

Labor productivity is measured by the average product of labor; i.e.,the quantity produced divided by the labor time required to produce it.All other things held constant,an increase in labor productivity will increase throughput by

• A)increasing productive capacity.
• B)increasing productive processing time.
• C)increasing yield.
• D)increasing all components of throughput.

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Definitions:

Standard Cost System

An accounting system that uses cost estimates for material, labor, and overhead to assign costs to products and analyze variances.

Fixed Manufacturing Overhead Rate

A consistent charge per unit of production or period that allocates the total fixed manufacturing overhead costs.

Variances

The difference between expected and actual performance or costs in business operations.

Direct Labor-Hours

The total hours worked by employees directly involved in the manufacturing process, often used as a basis for allocating manufacturing overhead costs.