Ruggles Circuit Company manufactures circuit boards for other firms

ACCOUNTING

Multiple Choice

Ruggles Circuit Company manufactures circuit boards for other firms. Management is attempting to search for ways to reduce manufacturing labor costs and has received a proposal from a consulting company to rearrange the production floor next year. Using the information below regarding current operations and the new proposal, which of the following decisions should management accept?



Currently Proposed

Required machine operators 5 4.5

Materials-handling workers 1.25 1.25

Employee average pay $8 per hour $9 per hour

Hours worked per employee 2,100 2,000



a. Do not change the production floor.

b. Rearrange the production floor.

c. Either, because it makes no difference to the employees.

d. It doesn't matter because the costs incurred will remain the same.


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