productivity and profitability assessment using financial … · 2014. 3. 23. · 1. determine...

1

Productivity and

Profitability Assessment

using Financial Statements

Diego PRIOR

2

SESSION 1.DEFINITION OF THE ECONOMIC

AND FINANCIAL VARIABLES NEEDED TO

APPLY THE ANALYSIS.

MODEL OF BALANCE SHEET. OSIRIS DATABASE

ASSETS LIABILITIES

Current Assets Current Liabilities

Stocks Loans

Debtors Creditors

Others Other

Cash & Cash Equivalent Non Current Liabilities

Fixed Assets Long Term Debt

Tangible Fixed Assets Other Non Current Liabilities

Intangible Fixed Assets Shareholders Funds (EQUITY)

Other Fixed Assets Capital

Other

Total Assets Total Shareh. Funds & Liab.

MODEL OF INCOME STATEMENT. OSIRIS DATABASE

Operating Revenue / Turnover

Sales

(-) Costs of Goods Sold

(=) Gross Profit

(-) Other Operating Items

(-) Depreciation/Amortization

(=) Operating P/L

Financial Revenue

Financial Expenses

(+) Financial P/L

(+) Other non Oper./Financial Items

(=) P/L before Tax

(-) Taxation

(=) P/L after Tax

(+) Extraord. & Oth. Items

(=) P/L for Period

Costs of Goods Sold = (Material Costs) + (Costs of Employees)

3

CHAPTER 01. BASIC DEFINITIONS

PROFITABILITY:

�� =��

�� × 100

�� =��

��× 100

�� =��

�� × 100

��!�� =� " #� �

�$% #� �× 100

PRODUCTIVITY:

��&�'��"�� =��%��

(#%��

4

OCCUPANCY RATE:

�!� �" & ��%��

)�$. ��%��× 100

INPUTS MIX:

$+ = 10 ; $, = 30 : inputs mix 1

$+ = 30 ; $, = 10 : inputs mix 2

Impact on costs?

INPUT (x) OUTPUT (y)

PRODUCTION

PROCESS

5

PRODUCTIVITY:

EXERCISE 1:

��&�'��"�� = . =��%��

(#%��

Unit Output Input

A 100 10

B 150 13

C 200 16

D 300 23

E 500 27

Unit Output Input Productivity

A 100 10 10.00

B 150 13 11.53

C 200 16 12.50

D 300 23 13.00

E 500 27 18.51

6

EFFICIENCY:

��'� #'� ��

=.

./01× 100

Unit Output Input Productivity Efficiency

A 100 10 10.00 54.02 %

B 150 13 11.53 62.29 %

C 200 16 12.50 67.53%

D 300 23 13.00 70.23%

E 500 27 18.51 100.00%

Output orientation to achieve efficiency

Input orientation to achieve efficiency

7

FINANCIAL STATEMENTS:

Physical magnitudes � money

Output price = %2 = 30

Input price = %1 = 1000 (fixed input)

A B C D E

Total assets 10000 13000 16000 23000 27000

User cost (wx)

(depreciation 20 %; financial cost 10 %)

A B C D E

(+)Revenues 3000 4500 6000 9000 15000

(-) Expenses 3000 3900 4800 6900 8100

(=) Profit/L 0 600 1200 2100 6900

8

�� =��

�� × 100

A B C D E

��

�� × 100

0% 4.61% 7.5% 9.13% 25.5%

Compute ROA for the output orientation strategy: (25.5 %)

Compute ROA for the input orientation strategy

�� =��

�� × 100

A B C D E

��

�� × 100

0% 13.33% 20.00% 23.33% 46.00%

9

��!�� =� " #� �

�$% #� �× 100

A B C D E

� " #� �

�$% #� �× 100

100% 115.38% 125.00% 130.43% 185.18%

EXERCISE 2:

1. Determine productivity, efficiency, ROA, ROS and

profitability ratio for year 2 (px= 1000).

2. Estimate ROA after the output and the input

orientation to reach the efficient frontier.

Unit Output Input py wx

A 100 10 30 30.00 %

B 130 13 25 35.00 %

C 210 16 35 33.00%

D 280 23 35 35.00%

E 550 27 40 30.00%

10

SESSION 2. ASSESSMENT OF THE

ECONOMIC PERFORMANCE: PROFITABILITY

RATIOS

CONTENTS OSIRIS DATABASE

Consolidated data

Parent company

Subsidiary

Segment data

KEY RATIOS

Return on Shareholders Funds (%) =

= �� =��

��× 100

Profit Margin (%)=

= �� =��

�� × 100

11

Return on Total Assets (%)=

= �� =��

�� × 100

3�� #� �� =3�� #� ��

3�� #� ��!��

Solvency Ratio (%) =

=4 � �#'�5 + 7 %� '/�5��

4�# − '�� #� ��!. +3�� #� ��!.× 100

Price Earning Ratio =

=)��: � '�%��#

4 � �#'�5 × 100

EBIT = Operating Profits/Losses

EBITDA = EBIT + Depreciation/Amortization

12

01. CONTENTS INCOME FUND REPORT

Total debt to total capital

Cash flow to total debt

EBITDA interest coverage

ROE

Market capitalization

OPERATING STATISTICS:

�''�%�#'� �� = # #�<ℎ�� % #�

#��5� × 365

�" ��< &�� 5 �� = � " #� �

#��5� × 365

� "%�� = � " #� �

#��5�

13

Earnings manipulation

Income smoothing

Accounting choice

Taking a big bath

DEFINITION OF ROE AND ROA FOR THE ANALYSIS

FIRM A FIRM B

TOTAL ASSETS 1000 1000

Non Current Liabilities 600 0

Shareholders Funds

400 1000

INCOME STATEMENT FIRM A FIRM B

Oper. Rev. / Turn.

Sales 300 300

(-) Costs of Goods Sold 100 100

(=) Operating P/L 200 200

(-) Financial Expenses (10%) 40 -

(=) P/L before Tax 160 200

(-) Taxation (30 %) 48 60

(=) P/L for Period 112 140

14

EXERCISE:

1. Estimate ROE and ROA

2. Estimate the leverage effect

3. Comment the movements from year 1 to year 2

4. Explore the changes needed for year 3 to achieve a ROE of 10%

Year 1 Year 2

TOTAL ASSETS 1000 1500

Non Current Liabilities 400 900

Shareholders Funds

600 600

INCOME STATEMENT Year 1 Year 2

Oper. Rev. / Turn.

Sales 300 450

(-) Costs of Goods Sold 100 300

(=) Operating P/L 200 150

(-) Financial Expenses 40 135

(=) P/L before Tax 160 15

(-) Taxation 48 4.5

(=) P/L for Period 112 10.5

15

DEFINITIONS

P/L FOR PERIOD

ROE = --------------

EQUITY

P/L FOR PERIOD + FINANCIAL EXPENSES.(1-t)

ROA = -----------------------------------------

TA

P/L FOR PERIOD + FINANCIAL EXPENSES.(1-t)- EXTRAORD.ITEMS

NROA = ---------------------------------------------------------

TA

EXTRAORD.ITEMS

EXROA = --------------

TA

OPERATING P/L.(1-t)

OROA = -------------------

TA

(FINANCIAL REVENUE + OTHER NON OPER.ITEMS).(1-t)

NOROA = ------------------------------------------------

TA

Cost of Financial expenses.(1-t)

Debts i = ------------------------

Liabilities

Liabilities

Leverage f = -----------

Equity

Operating Revenue

Sales turnover turn = -----------------

TA

OPERATING P/L.(1-t)

Net margin m = -------------------

Operating Revenue

OPERATING P/L.(1-t) = [GROSS PROFIT – (OTHER OPERATING ITEMS +

+ DEPRECIATION(AMORTIZATION)].(1-t)

GROSS PROFIT.(1-t)

Gross margin gm = ------------------

Operating Revenue

Rate of fixed [OTHER OPERATING ITEMS +DEPRECIATION(AMORTIZATION)].(1-t) costs fc = ---------------------------------------------------------

Operating Revenue

17

SESSION 3. MULTIFACTOR PRODUCTIVITY

AND PROFIT MARGINS

PRODUCTIVITY

OPERATING P/L.(1-t)

Net margin m = ---------------------

Operating Revenue

GROSS PROFIT.(1-t)

Gross margin gm = ---------------------

Operating Revenue

Rate of fixed [OTHER OPERATING ITEMS + DEPRECIATION(AMORTIZATION)] .(1-t) costs fc = ------------------------------------------------------------

Operating Revenue

m = gm - fc

GROSS PROFIT.(1-t) (Operating Revenue – Costs of Goods Sold).(1-t) gm = ------------------- = ------------------------------------------------= Operating Revenue Operating Revenue

Operating Revenue Costs of Goods Sold

= [----------------- - -------------------].(1-t) =

Operating Revenue Operating Revenue

Costs of Goods Sold

= [ 1 - -------------------].(1-t)

Operating Revenue

and:

m = [1 – c – fc]

18

PRODUCTIVITY INDEX:

OUTPUTS Y PRO = -------- = -

INPUTS X

OUTPUTS1 Y1 PRO1 = --------- = --

INPUTS1 X1

OUTPUTS0 Y0 PRO0 = --------- = --

INPUTS0 X0

PRO1 Y1/X1 Y1/Y0

PROg = ------ = ----- = ----

PRO0 Y0/X0 X1/X0

PRICES INDEX:

OUTPUTS PRICE P PRI = -------------- = -

INPUTS INPUTS W

OUTPUTS PRICE1 P1 PRI1 = --------------- = --

INPUTS PRICE1 W1

OUTPUTS PRICE0 P0 PRI0 = --------------- = --

INPUTS PRICE0 W0

PRI1 P1/W1 P1/P0

PRIg = ------ = ----- = -----

PRI0 P0/W0 W1/W0

19

PRODUCTIVITY, PRICES INDICES AND OPERATING

COST RATES

Costs of Goods Sold W.X c = -------------------- = ----

Operating Revenue P.Y

Costs of Goods Sold W1.X1 c1 = -------------------- = -----

Operating Revenue P1.Y1

Costs of Goods Sold W0.X0 c0 = -------------------- = -----

Operating Revenue P0.Y0

c0

c1 = ---------

PROg.PRIg

PRODUCTIVITY, PRICES INDICES AND FIXED COST

RATES

Wf.Xf fc = -----

P.Y

Wf1.Xf1 fc1 = ------

P1.Y1

Wf0.Xf0 fc0 = ------

P0.Y0

fc0

fc1 = ----------

PROfg.PRIfg

20

MULTIPLE INPUTS CASE

PRODUCTIVITY INDEX:

OUTPUTS Y PRO = -------- = ----

INPUTS ΣW.X

OUTPUTS1 Y1 PRO1 = --------- = -----

INPUTS1 ΣW0.X1

OUTPUTS0 Y0 PRO0 = --------- = -----

INPUTS0 ΣW0.X0

PRO1 Y1/ΣW1.X1 Y1/Y0

PROg = ------ = -------- = ------------

PRO0 Y0/ΣW0.X0 ΣW0.X1/ΣW0.X0

PRICES INDEX:

OUTPUTS PRICE P PRI = -------------- = ----

INPUTS INPUTS ΣW.X

OUTPUTS PRICE1 P1 PRI1 = --------------- = -----

INPUTS PRICE1 ΣW1.X1

OUTPUTS PRICE0 P0 PRI0 = --------------- = -----

INPUTS PRICE0 ΣW0.X1

PRI1 P1/ΣW1.X0 P1/P0

PRIg = ------ = -------- = ------------

PRI0 P0/ΣW0.X0 ΣW1.X1/ΣW0.X1

21

SESSION 4. EXTENSIONS OF THE

MULTIFACTOR PRODUCTIVITY INDEX:

BENCHMARKING

25

1

ORIGINAL DATA

0

2

4

6

8

10

12

0 2 4 6 8 10 12

2

1

3

4

5

6

7

8

9

10

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1

BENCHMARK ON CRS TECHNOLOGY

0

2

4

6

8

10

12

0 2 4 6 8 10 12

2

1

3

4

5

6

7

8

9

10

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1

BENCHMARK ON VRS TECHNOLOGY

0

2

4

6

8

10

12

0 2 4 6 8 10 12

2

1

3

4

5

6

7

8

9

10

28

1

ESTIMATION OF THE ECONOMIES OF SCALE

0

2

4

6

8

10

12

0 2 4 6 8 10 12

2

1

3

4

5

6

7

8

9

10

29

EXERCISES ON THE MEASUREMENT OF THE

TOTAL FACTOR PRODUCTIVITY

01_profits_partial_and_TFP

Partial factor productivity quantification

Year 1OUTPUT 1 OUTPUT 2 OUTPUT 3

units (y) 10.000 4.800 2.400

selling price (pv) 15,00 21,40 39,00

Variable inputs: x w (x).(w) t w (x).(w) t w (x).(w)

Labor cost 0,22 19,60 4,31 0,25 19,60 4,90 0,42 19,60 8,23

Material cost 1,05 3,60 3,78 1,16 3,60 4,18 1,40 3,60 5,04

Energy 0,52 5,90 3,07 0,64 5,90 3,78 0,82 5,90 4,84

Total variable costs 11,16 12,85 18,11

Contribution margin 3,84 8,55 20,89


units (y) 12.000 5.500 1.800

selling price (pv) 16,00 20,00 40,00


Labor cost 0,20 22,00 4,40 0,30 22,00 6,60 0,40 22,00 8,80

Material cost 1,00 4,40 4,40 1,10 4,40 4,84 1,30 4,40 5,72

Energy 0,50 5,80 2,90 0,60 5,80 3,48 0,80 5,80 4,64




units (y) 11.000 5.600 2.000

selling price (pv) 15,50 20,20 42,00


Labor cost 0,25 23,00 5,75 0,25 23,00 5,75 0,35 23,00 8,05

Material cost 1,30 4,60 5,98 1,05 4,50 4,73 1,15 4,50 5,18

Energy 0,60 5,95 3,57 0,55 5,90 3,25 0,80 5,90 4,72



PERFORMANCE ANALYSISYear 1 Year 2

Sales y pv value y pv value

output 1 10.000 15,00 150.000 12.000 16,00 192.000

output 2 4.800 21,40 102.720 5.500 20,00 110.000

output 3 2.400 39,00 93.600 1.800 40,00 72.000

total sales 346.320 374.000

Variable costs x w value x w value

Labor 4.408 19,60 86.397 4.770 22,00 104.940

Materials 19.428 3,60 69.941 20.390 4,40 89.716

Energy 10.240 5,90 60.416 10.740 5,80 62.292

(-) Total variable costs 216.754 256.948

(=) Contribution margin 129.566 117.052

(-) Overhead (fixed)costs 75.000 84.000

(=) Profits 54.566 33.052

30

Partial factor productivity (partial factor productivity)Productivity in year 1 and year 2

Year 1 Year 2

OUTPUT 1 OUTPUT 2 OUTPUT 3 OUTPUT 1 OUTPUT 2 OUTPUT 3

Labor 4,55 4,00 2,38 5,00 3,33 2,50

Material 0,95 0,86 0,71 1,00 0,91 0,77

Energy 1,92 1,56 1,22 2,00 1,67 1,25

Productivity changes between period 1 and period 2OUTPUT 1 OUTPUT 2 OUTPUT 3

ratio change (%) ratio change (%) ratio change (%)

Labor 1,10 10,00% 0,83 -16,67% 1,05 5,00%

Material 1,05 5,00% 1,05 5,45% 1,08 7,69%

Energy 1,04 4,00% 1,07 6,67% 1,03 2,50%

Total factor productivityOUTPUT 1 OUTPUT 2 OUTPUT 3

change (%) % of cost change (%) % of cost change (%) % of cost

Labor 10,00% 38,64% -16,67% 38,13% 5,00% 45,46%

Material 5,00% 33,87% 5,45% 32,49% 7,69% 27,83%

Energy 4,00% 27,49% 6,67% 29,38% 2,50% 26,71%

TFP: 6,66% -2,62% 5,08%

% of revenues 43,31% 29,66% 27,03%

cumulated TFP: 3,48%

Required:

1. From year 1 to year 2 TFP have increase but profits drop. Are these movements compatible?

2. Compute profits for year 3 and TFP change between years 2 and 3 (fixed costs for year 84.000).

31

02_MACROECONOMIC APPROACH

CASE STUDY 1VARIABLE COST AND NET MARGIN

Year 1

OUTPUT 1 OUTPUT 2 OUTPUT 3

units (y) 10.000 4.800 2.400

selling price (pv) 15,00 21,40 39,00

Variable inputs: t w (t).(w) t w (t).(w) t w (t).(w)

Labor cost 0,22 19,60 4,31 0,25 19,60 4,90 0,42 19,60 8,23

Material cost 1,05 3,60 3,78 1,16 3,60 4,18 1,40 3,60 5,04

Energy 0,52 5,90 3,07 0,64 5,90 3,78 0,82 5,90 4,84




units (y) 12.000 5.500 1.800

selling price (pv) 16,00 20,00 40,00


Labor cost 0,20 22,00 4,40 0,30 22,00 6,60 0,40 22,00 8,80

Material cost 1,00 4,40 4,40 1,10 4,40 4,84 1,30 4,40 5,72

Energy 0,50 5,80 2,90 0,60 5,80 3,48 0,80 5,80 4,64




units (y) 15.000 8.600 1.700

selling price (pv) 18,00 25,00 38,00


Labor cost 0,15 23,00 3,45 0,25 23,00 5,75 0,35 23,00 8,05

Material cost 0,90 5,00 4,50 1,00 5,00 5,00 1,10 5,00 5,50

Energy 0,50 5,60 2,80 0,55 5,60 3,08 0,60 5,60 3,36



PROFIT AND LOSS ACCOUNTYear 1 Year 2 Year 3

Sales y pv value y pv value y pv value

output 1 10.000 15,00 150.000 12.000 16,00 192.000 15.000 18,00 270.000

output 2 4.800 21,40 102.720 5.500 20,00 110.000 8.600 25,00 215.000

output 3 2.400 39,00 93.600 1.800 40,00 72.000 1.700 38,00 64.600

total sales 346.320 374.000 549.600

Variable costs x w value x w value x w value

Labor 4.408 19,60 86.397 4.770 22,00 104.940 4.995 23,00 114.885

Materials 19.428 3,60 69.941 20.390 4,40 89.716 23.970 5,00 119.850

Energy 10.240 5,90 60.416 10.740 5,80 62.292 13.250 5,60 74.200

(-) Total variable costs 216.754 256.948 308.935

(=) Contribution margin 129.566 117.052 240.665

(-) Overhead (fixed)costs 12.500 11.350 15.000

(-) Depreciation costs 62.500 72.650 85.503

(=) Profits 54.566 33.052 140.162

EFFICIENCY ANALYSIS

CASE STUDYBALANCE SHEET

Year 1 Year 2 Year 3

Land 15.000,00 16.500,00 17.325,00

Machinery and equipment 500.000,00 581.250,00 684.030,00

Inventories 150.000,00 170.000,00 153.868,00

Accounts receivable-trade 100.000,00 89.350,00 111.700,00

Cash and cash equivalents 15.000,00 16.500,00 17.325,00

Total Assets 780.000,00 873.600,00 984.248,00

inflation rate 10 % 5 %

32

MACROECONOMIC APPROACH

Erik Hörnell (1992), Improving productivity for competitive advantage , Pitman Publishing.

Year 1Value Added quantification

Revenues

Year 1

Revenues y pv value

output 1 10000 15 150000

output 2 4800 21,4 102720output 3 2400 39 93600

total sales 346320

x w value

Materials 19428 3,6 69941

Energy 10240 5,9 60416

(-) Intermediate consumption 130357

(=) Brut Value Added 215963 x w value

(-) Labor costs 86397 Labor 4.408 19,60 86.397

(=) Brut Operating Surplus 129566

(-) Depreciation costs 62500 Productivity = (Value added)/(Total hours or work)

(-) Overhead (fixed)costs 12500 Productivity = 48,99

(=) Profits 54566 Revenues Interm. Cons. Increase

1. Increase in units produced ( 10 %) 380952,00 143392,48 53,89 0,10

2. Increase in quality (prices 10 %) 380952,00 130356,80 56,85 0,16

3. Costs reduction ( 10 %) 346320,00 117321,12 51,95 0,06

Inflation 10 % 380952,00 143392,48 53,89 0,10

Innovation (changes in output mix)

33

03_APC, 1975 (RATIO FORM)

CASE STUDYVARIABLE COST AND NET MARGIN


units (y) 10.000 4.800 2.400

selling price (pv) 15,00 21,40 39,00


Labor cost 0,22 19,60 4,31 0,25 19,60 4,90 0,42 19,60 8,23

Material cost 1,05 3,60 3,78 1,16 3,60 4,18 1,40 3,60 5,04

Energy 0,52 5,90 3,07 0,64 5,90 3,78 0,82 5,90 4,84




units (y) 12.000 5.500 1.800

selling price (pv) 16,00 20,00 40,00


Labor cost 0,20 22,00 4,40 0,30 22,00 6,60 0,40 22,00 8,80

Material cost 1,00 4,40 4,40 1,10 4,40 4,84 1,30 4,40 5,72

Energy 0,50 5,80 2,90 0,60 5,80 3,48 0,80 5,80 4,64




units (y) 15.000 8.600 1.700

selling price (pv) 18,00 25,00 38,00


Labor cost 0,15 23,00 3,45 0,25 23,00 5,75 0,35 23,00 8,05

Material cost 0,90 5,00 4,50 1,00 5,00 5,00 1,10 5,00 5,50

Energy 0,50 5,60 2,80 0,55 5,60 3,08 0,60 5,60 3,36



PROFIT AND LOSS ACCOUNTYear 1 Year 2 Year 3

Sales y pv value y pv value y pv value

output 1 10.000 15,00 150.000 12.000 16,00 192.000 15.000 18,00 270.000

output 2 4.800 21,40 102.720 5.500 20,00 110.000 8.600 25,00 215.000

output 3 2.400 39,00 93.600 1.800 40,00 72.000 1.700 38,00 64.600

total sales 346.320 374.000 549.600

Variable costs x w value x w value x w value

Labor 4.408 19,60 86.397 4.770 22,00 104.940 4.995 23,00 114.885

Materials 19.428 3,60 69.941 20.390 4,40 89.716 23.970 5,00 119.850

Energy 10.240 5,90 60.416 10.740 5,80 62.292 13.250 5,60 74.200

(-) Total variable costs 216.754 256.948 308.935

(=) Contribution margin 129.566 117.052 240.665

(-) Overhead (fixed)costs 12.500 11.350 15.000

(-) Depreciation costs 62.500 72.650 85.503

(=) Profits 54.566 33.052 140.162

EFFICIENCY ANALYSIS

CASE STUDYBALANCE SHEET

Year 1 Year 2 Year 3

Land 15.000,00 16.500,00 17.325,00

Machinery and equipment 500.000,00 581.250,00 684.030,00

Inventories 150.000,00 170.000,00 153.868,00

Accounts receivable-trade 100.000,00 89.350,00 111.700,00

Cash and cash equivalents 15.000,00 16.500,00 17.325,00

Total Assets 780.000,00 873.600,00 984.248,00

inflation rate 10 % 5 %

34

APC, 1975 (RATIO FORM)

Revenues year 2: 374.000,00 profitability ratio year 2: 1,455547

Variable costs year 2: 256.948,00 change in profitability ratio: 0,910993

(profitability index)

Revenues year 1: 346.320,00 profitability ratio year 1: 1,597759

Variable costs year 1: 216.753,60

Deflacted revenues year 2:

y2 pv1 y2.pv1

output 1 12000 15 180000

output 2 5500 21,4 117700

output 3 1800 39 70200

367900

Deflacted variable costs year 2:

x2 w1 x2.w1

Labor 4770 19,6 93492

Materials 20390 3,6 73404

Energy 10740 5,9 63366

230262

Productivity index

y2.pv1/y1.pv1

Deflacted revenues year 2: 367.900,00 y2.pv1 1,062312

Revenues year 1: 346.320,00 y1.pv1 0,999991

x2.w1/x1.w1

Deflacted variable costs year 2: 230.262,00 x2.w1 1,062321

Variable costs year 1: 216.753,60 x1.w1

0,910993 (profitability index)

Price recovery index

y2.pv2/y2.pv1

Revenues year 2 : 374.000,00 y2.pv2 1,016581

Deflacted revenues year 2: 367.900,00 y2.pv1 0,911001

x2.w2/x2.w1

Variable costs year 2: 256.948,00 x2.w2 1,115894

Deflacted variable costs year 2: 230.262,00 x2.w1

35

04_AMERICAN PRODUCTIVITY CENTER, (1975), Kaplan (1982)


units (y) 10.000 4.800 2.400

selling price (pv) 15,00 21,40 39,00


Labor cost 0,22 19,60 4,31 0,25 19,60 4,90 0,42 19,60 8,23

Material cost 1,05 3,60 3,78 1,16 3,60 4,18 1,40 3,60 5,04

Energy 0,52 5,90 3,07 0,64 5,90 3,78 0,82 5,90 4,84




units (y) 12.000 5.500 1.800

selling price (pv) 16,00 20,00 40,00


Labor cost 0,20 22,00 4,40 0,30 22,00 6,60 0,40 22,00 8,80

Material cost 1,00 4,40 4,40 1,10 4,40 4,84 1,30 4,40 5,72

Energy 0,50 5,80 2,90 0,60 5,80 3,48 0,80 5,80 4,64


Contribution margin (m) 4,30 5,08 20,84

PERFORMANCE ANALYSIS

Year 1 Year 2


output 1 10.000 15,00 150.000 12.000 16,00 192.000

output 2 4.800 21,40 102.720 5.500 20,00 110.000

output 3 2.400 39,00 93.600 1.800 40,00 72.000

total sales 346.320 374.000


Labor 4.408 19,60 86.397 4.770 22,00 104.940

Materials 19.428 3,60 69.941 20.390 4,40 89.716

Energy 10.240 5,90 60.416 10.740 5,80 62.292




(=) Profits 54.566 33.052

36

Sales-activity variance y2 y1 m1 (y2-y1).m1

output 1 12.000 10.000 3,84 7.680

output 2 5.500 4.800 8,55 5.984

output 3 1.800 2.400 20,89 -12.534

(1) Total change in output quantity 1.130

Sales-volume variance y2 y1 m1average (y2-y1).maverage

output 1 12.000 10.000 7,53 15.066

output 2 5.500 4.800 7,53 5.273

output 3 1.800 2.400 7,53 -4.520

Total change in sales-volume variance 15.819

Sales-mix variance y2 y1 m1 (y2-y1).(m1-m1average)

output 1 12.000 10.000 3,84 -7.386

output 2 5.500 4.800 8,55 711

output 3 1.800 2.400 20,89 -8.014

Total change in sales-mix variance -14.690

Price-recovery variance

Sales-price variance pv2 pv1 y2 (pv2-pv1).y2

output 1 16,00 15,00 12.000 12.000

output 2 20,00 21,40 5.500 -7.700

output 3 40,00 39,00 1.800 1.800

Total change in sales-price variance 6.100

Input-cost variance w1 w2 x2 (w1-w2).x2

input 1 19,60 22,00 4.770 -11.448

input 2 3,60 4,40 20.390 -16.312

input 3 5,90 5,80 10.740 1.074

Total change in input-cost variance -26.686

(2) Total change in price-recovery variance -20.586

Productivity variance

Labor t1 t2 w1 y2 (t1-t2).w1.y2

output 1 0,22 0,20 19,60 12.000 4.704

output 2 0,25 0,30 19,60 5.500 -5.390

output 3 0,42 0,40 19,60 1.800 706

Total change in labor productivity variance 20

Materials t1 t2 w1 y2 (t1-t2).w1.y2

output 1 1,05 1,00 3,60 12.000 2.160

output 2 1,16 1,10 3,60 5.500 1.188

output 3 1,40 1,30 3,60 1.800 648

Total change in materials productivity variance 3.996

Energy t1 t2 w1 y2 (t1-t2).w1.y2

output 1 0,52 0,50 5,90 12.000 1.416

output 2 0,64 0,60 5,90 5.500 1.298

output 3 0,82 0,80 5,90 1.800 212

Total change in energy productivity variance 2.926

(3) Total productivity variance 6.942

Total change in contribution margin (1)+(2)+(3) -12.514

37

05_ACCOUNTING MODEL (Kaplan, 1982)


units (y) 10.000 4.800 2.400

selling price (pv) 15,00 21,40 39,00


Labor cost 0,22 19,60 4,31 0,25 19,60 4,90 0,42 19,60 8,23

Material cost 1,05 3,60 3,78 1,16 3,60 4,18 1,40 3,60 5,04

Energy 0,52 5,90 3,07 0,64 5,90 3,78 0,82 5,90 4,84




units (y) 12.000 5.500 1.800

selling price (pv) 16,00 20,00 40,00


Labor cost 0,20 22,00 4,40 0,30 22,00 6,60 0,40 22,00 8,80

Material cost 1,00 4,40 4,40 1,10 4,40 4,84 1,30 4,40 5,72

Energy 0,50 5,80 2,90 0,60 5,80 3,48 0,80 5,80 4,64



PERFORMANCE ANALYSIS

Year 1 Year 2


output 1 10.000 15,00 150.000 12.000 16,00 192.000

output 2 4.800 21,40 102.720 5.500 20,00 110.000

output 3 2.400 39,00 93.600 1.800 40,00 72.000

total sales 346.320 374.000


Labor 4.408 19,60 86.397 4.770 22,00 104.940

Materials 19.428 3,60 69.941 20.390 4,40 89.716

Energy 10.240 5,90 60.416 10.740 5,80 62.292




(=) Profits 54.566 33.052

38


Sales y pv value y pv value changes

output 1 10.000 15,00 150.000 12.000 16,00 192.000 42.000

output 2 4.800 21,40 102.720 5.500 20,00 110.000 7.280

output 3 2.400 39,00 93.600 1.800 40,00 72.000 -21.600

total sales 346.320 374.000 27.680


Labor 4.408 19,60 86.397 4.770 22,00 104.940 -18.543

Materials 19.428 3,60 69.941 20.390 4,40 89.716 -19.775

Energy 10.240 5,90 60.416 10.740 5,80 62.292 -1.876

(-) Total variable costs 216.754 256.948 -40.194

(=) Contribution margin 129.566 117.052 -12.514

(-) Overhead (fixed)costs 75.000 84.000 -9.000

(=) Profits 54.566 33.052 -21.514

change in revenues

change in output quantity y2 y1 pv1 (y2-y1).pv1

output 1 12.000 10.000 15,00 30.000

output 2 5.500 4.800 21,40 14.980

output 3 1.800 2.400 39,00 -23.400

Total change in output quantity 21.580

change in output price pv2 pv1 y2 (pv2-pv1).y2

output 1 16,00 15,00 12.000 12.000

output 2 20,00 21,40 5.500 -7.700

output 3 40,00 39,00 1.800 1.800

Total change in output price 6.100

Total change in revenues 27.680

change in variable costs

change in input quantity x1 x2 w1 (x1-x2).w1

input 1 4.408 4.770 19,60 -7.095

input 2 19.428 20.390 3,60 -3.463

input 3 10.240 10.740 5,90 -2.950

Total change in input quantity -13.508

change in input price w1 w2 x2 (w1-w2).x2

input 1 19,60 22,00 4.770 -11.448

input 2 3,60 4,40 20.390 -16.312

input 3 5,90 5,80 10.740 1.074

Total change in input prices -26.686

Total change in variable costs -40.194

Total change in contribution margin -12.514

39

06_Adjusted kaizen costs


units (y) 10.000 4.800 2.400

selling price (pv) 15,00 21,40 39,00


Labor cost 0,22 19,60 4,31 0,25 19,60 4,90 0,42 19,60 8,23

Material cost 1,05 3,60 3,78 1,16 3,60 4,18 1,40 3,60 5,04

Energy 0,52 5,90 3,07 0,64 5,90 3,78 0,82 5,90 4,84




units (y) 12.000 5.500 1.800

selling price (pv) 16,00 20,00 40,00


Labor cost 0,20 22,00 4,40 0,30 22,00 6,60 0,40 22,00 8,80

Material cost 1,00 4,40 4,40 1,10 4,40 4,84 1,30 4,40 5,72

Energy 0,50 5,80 2,90 0,60 5,80 3,48 0,80 5,80 4,64





output 1 10.000 15,00 150.000 12.000 16,00 192.000

output 2 4.800 21,40 102.720 5.500 20,00 110.000

output 3 2.400 39,00 93.600 1.800 40,00 72.000

total sales 346.320 374.000


Labor 4.408 19,60 86.397 4.770 22,00 104.940

Materials 19.428 3,60 69.941 20.390 4,40 89.716

Energy 10.240 5,90 60.416 10.740 5,80 62.292




(=) Profits 54.566 33.052

40

Yasuhiro Monden (1997), Sistemas de reducción de costes

Productivity Press

Adjusted kaizen costs

vc1 vc2 (vc1-vc2).y1

output 1 11,16 11,70 -5.400,00

output 2 12,85 14,92 -9.926,40

output 3 18,11 19,16 -2.520,00

kaizen cost variation -17.846,40

41

07_Kurosawa (1991), AIPR systemYear 1

OUTPUT 1 OUTPUT 2 OUTPUT 3

units (y) 10.000 4.800 2.400

selling price (pv) 15,00 21,40 39,00


Labor cost 0,22 19,60 4,31 0,25 19,60 4,90 0,42 19,60 8,23

Material cost 1,05 3,60 3,78 1,16 3,60 4,18 1,40 3,60 5,04

Energy 0,52 5,90 3,07 0,64 5,90 3,78 0,82 5,90 4,84




units (y) 12.000 5.500 1.800

selling price (pv) 16,00 20,00 40,00


Labor cost 0,20 22,00 4,40 0,30 22,00 6,60 0,40 22,00 8,80

Material cost 1,00 4,40 4,40 1,10 4,40 4,84 1,30 4,40 5,72

Energy 0,50 5,80 2,90 0,60 5,80 3,48 0,80 5,80 4,64





output 1 10.000 15,00 150.000 12.000 16,00 192.000

output 2 4.800 21,40 102.720 5.500 20,00 110.000

output 3 2.400 39,00 93.600 1.800 40,00 72.000

total sales 346.320 374.000


Labor 4.408 19,60 86.397 4.770 22,00 104.940

Materials 19.428 3,60 69.941 20.390 4,40 89.716

Energy 10.240 5,90 60.416 10.740 5,80 62.292




(=) Profits 54.566 33.052

42

Kurosawa (1991), AIPR system

Profit variance (R2-R1): -21.514

Price recovery variance

y2 pv2 pv1 y2.(pv2-pv1)

output 1 12.000 16,00 15,00 12.000

output 2 5.500 20,00 21,40 -7.700

output 3 1.800 40,00 39,00 1.800

6.100

x2 w2 w1 -x2.(w2-w1)

Labor cost 4.770 22,00 19,60 -11.448

Material cost 20.390 4,40 3,60 -16.312

Energy 10.740 5,80 5,90 1.074

-26.686

-(F2-F1)

-9.000

Total price recovery variance -29.586

Productivity variance

y2 y1 pv1 pv1.(y2-y1)

output 1 12.000 10.000 15,00 30.000

output 2 5.500 4.800 21,40 14.980

output 3 1.800 2.400 39,00 -23.400

21.580

x2 x1 w1 -w1.(x2-x1)

Labor 4.770 4.408 19,60 -7.095

Materials 20.390 19.428 3,60 -3.463

Energy 10.740 10.240 5,90 -2.950

-13.508

Total productivity variance 8.072

43

Decomposition on productivity variance

Technical progress

y2 pv1 pv1.y2

output 1 12.000 15,00 180.000

output 2 5.500 21,40 117.700

output 3 1.800 39,00 70.200

367.900

ππππ1111 1,1870

x2 w1 -ππππ1w1.x2

Labor 4.770 19,60 -110.978

Materials 20.390 3,60 -87.133

Energy 10.740 5,90 -75.217

-273.328

-ππππ1.F1

-89.027

Total variance due to technical progress: 5.545

Expansion or Scale effect

x2 w1 ππππ1111.w1.x2

Labor 4770 19,6 110.978

Materials 20390 3,6 87.133

Energy 10740 5,9 75.217

273.328

ππππ1.F1

89.027

-y1.pv1

-346.320

-w1.(x2-x1)

-13.508

Total variance due to expansion or scale effect 2.526

productivity and profitability assessment using financial … · 2014. 3. 23. · 1. determine...

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