White Tiger Electronics produces CD players using an automated assembly line process. The standard cost of CD players is $148 per unit (labor, $25 ; materials, $68 ; and overhead, $55 ). The sales price is $300 per unit. a. To achieve a 12 percent multifactor productivity improvement by reducing materials costs only, one needs to reduce the materials cost by nothing percent. (Enter your response as a percent rounded to two decimal places. B. To achieve a 12 percent multifactor productivity improvement by reducing labor costs only, one needs to reduce the materials cost by nothing percent. (Enter your response as a percent rounded to two decimal places. a. To achieve a 12 percent multifactor productivity improvement by reducing overhead costs only, one needs to reduce the materials cost by nothing percent. (Enter your response as a percent rounded to two decimal places.)

Question

Skyler Torres

Business

2 July, 01:33

White Tiger Electronics produces CD players using an automated assembly line process. The standard cost of CD players is $148 per unit (labor, $25 ; materials, $68 ; and overhead, $55 ). The sales price is $300 per unit. a. To achieve a 12 percent multifactor productivity improvement by reducing materials costs only, one needs to reduce the materials cost by nothing percent. (Enter your response as a percent rounded to two decimal places. B. To achieve a 12 percent multifactor productivity improvement by reducing labor costs only, one needs to reduce the materials cost by nothing percent. (Enter your response as a percent rounded to two decimal places. a. To achieve a 12 percent multifactor productivity improvement by reducing overhead costs only, one needs to reduce the materials cost by nothing percent. (Enter your response as a percent rounded to two decimal places.)

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Bethany Stark · Answer 1

A) a 23.5% decrease in materials

B) a 64% decrease in labor costs

C) a 29.1% decrease in overhead

Explanation:

White Tiger's multifactor productivity = $300 / $148 = 2.027

if we want to increase the multifactor productivity by 12%, it will = 2.27

since we will not change the sales price, we must determine the new total cost:

$300 / cost = 2.27

cost = $300 / 2.27 = $132.16 ≈ $132, which represents a $16 decrease

A) materials ⇒ $16/$68 = 23.5%

B) labor costs ⇒ $16/$25 = 64%

C) overhead ⇒ $16/$55 = 29.1%