At the End of 2014, Immaculate Productions Implemented a New

question 51

Essay

At the end of 2014, Immaculate Productions implemented a new labor process and redesigned its product with the expectation that input usage efficiency would increase. Now, at the end of 2015, 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:

a. Compute the partial operational measures for each input for both 2014 and 2015. What can be said about productivity improvement?
b. Prepare an income statement for each year and calculate the total change in profits.
c. Calculate the profit-linked productivity measure for 2015. What can be said about the productivity program?
d. Calculate the price-recovery component. What does this tell you?

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Definitions:

New Amsterdam

The 17th century Dutch colony that was located at the southern tip of Manhattan Island, which later became New York City upon English acquisition.

New Netherland

A 17th-century colonial province of the Dutch Republic that included parts of present-day New York, New Jersey, Delaware, and Connecticut.

Dutch Reformed Church

A Protestant Christian denomination originating in the Netherlands during the Reformation, known for Calvinist theology and significant presence in North America.

New Amsterdam

The 17th-century Dutch settlement that later became New York City, reflecting the early colonial history of the United States.