Additional Case Study: Zychol Chemicals Corporation to accompany CHAPTER 1 Operations and Productivity Roberto

Question: Additional Case Study: Zychol Chemicals Corporation to accompany CHAPTER 1 Operations and Productivity Roberto Pimentel, the production manager of Zychol Chemicals, in Houston, Texas, is preparing his quarterly report, which is to include a productivity analysis for hes department. One of the inputs is production data prepared by Shareena Walford, hisSee the answerSee the answerSee the answer done loading Show transcribed image textTranscribed image text: Additional Case Study: Zychol Chemicals Corporation to accompany CHAPTER 1 Operations and Productivity Roberto Pimentel, the production manager of Zychol Chemicals, in Houston, Texas, is preparing his quarterly report, which is to include a productivity analysis for hes department. One of the inputs is production data prepared by Shareena Walford, his operations analyst The report, which she gave him this morning, showed the following 2021 2022 Production (units) 4,500 6,000 Raw material used (barrels of petroleum by-products) 700 900 Labor hours 28,000 22,000 $375,000 Capital cost applied to the department (5) $620,000 Roberto knew that his labor cost per hour had increased from an average of $20 per hour to an average of $22 per hour, primarily due to a move by management to become more competitive with a new company that had just opened a plant in the area. He also knew that his average cost per barrel of raw material had increased from $320 to $360. He was concerned about the accounting procedures that increased his capital cost from $375,000 to $620,000, but earlier discussions with his boss suggested that there was nothing that could be done about that allocation Roberto wondered if his productivity had increased at all. He called Shareena into the office and conveyed the above information to her and asked her to prepare this part of the report Discussion Questions 1. Prepare the productivity part of the report for Roberto. He probably expects some analysis of productivity inputs for all factors, as well as a multifactor analysis for both years with the change in productivity (up or down) and the amount noted. 2. The producer price index had increased from 120 to 125, and this fact seemed to indicate to Roberto that has costs were too high. What do you tell him are the implications of this change in the producer price index? 3. Management’s expectation for departments such as Roberto’s is an annual productivity increase of 5% Did he reach this goal? Source Professor Hank Maddux III, Sam Houston State University Roberto Pimentel, the production manager of Zychol Chemicals, in Houston, Texas, is preparing his quarterly report, which is to include a productivity analysis for his department. One of the inputs is production data prepared by Shareena Walford, his operations analyst. The report, which she gave him this morning, showed the following 2021 2022 Production (units) 4,500 6,000 Raw material used (barrels of petroleum by-products) 700 900 Labor hours 28,000 22,000 $375,000 Capital cost applied to the department (S) $620,000 Roberto knew that his labor cost per hour had increased from an average of $20 per hour to an average of $22 per hour, primarily due to a move by management to become more competitive with a new company that had just opened a plant in the area. He also knew that his average cost per barrel of raw material had increased from $320 to $360. He was concerned about the accounting procedures that increased his capital cost from $375,000 to $620,000, but earlier discussions with his boss suggested that there was nothing that could be done about that allocation 4 Roberto wondered if his productivity had increased at all. He called Shareena into the office and conveyed the above information to her and asked her to prepare this part of the report Discussion Questions 1. Prepare the productivity part of the report for Roberto He probably expects some analysis of productivity inputs for all factors, as well as a multifactor analysis for both years with the change in productivity (up or down) and the amount noted 2. The producer price index had increased from 120 to 125, and this fact seemed to indicate to Roberto that his costs were too high. What do you tell him are the implications of this change in the producer price index? 3. Management’s expectation for departments such as Roberto’s is an annual productivity increase of 5% Did he reach this goal?