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Refer to the HR Reports in the Inquirer. Through past investments in recruiting and training Digby has obtained a productivity index of 109.5%. This means that Digby's labor costs would be increased by 9.5% if it did not have these productivity improvements. This is a competitive advantage that Digby can sustain or even widen further if its competitors have no HR initiatives. Now, refer to the Income Statement in Digby's Annual Report. How much did Digby's productivity improvements save it in direct labor costs (in thousands) last year?
$3,086
$3,163
$29,668
$806

Respuesta :

abiolataiwo2015

Digby's productivity improvements save it in direct labor costs (in thousands) last year is: $3,086.

Saving in labor cost last year

Using this formula

Saving in labor cost last year = Labor cost during current year× Increase in labor cost during current year

Where:

Labor cost during current year =32,485

Increase in labor cost during current year = 9.5%

Let plug in the formula

Saving in labor cost last year = 32,485×9.5%

Saving in labor cost last year =$3,086

Therefore, Saving in labor cost last year is $3,086.

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