Reference no: EM132509917

Xavier Company produces a single product. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. The standard costs for one unit of product are as follows:

Direct material: 6 ounces at $0.50 per ounce . . . . . . . . . . . . . . . . . . $3

Direct labor: 1.8 hours at $10 per hour . . . . . . . . . . . . . . . . . . . . . . . 18

Variable manufacturing overhead: 1.8 hours at $5 per hour . . . . . . . 9

Total standard variable cost per unit . . . . . . . . . . . . . . . . . . . . . . . . . $30

During June, 2,000 units were produced. The costs associated with June's operations were as follows:

Material purchased: 18,000 ounces at $0.60 per ounce . . . . . . . $10,800

Material used in production: 14,000 ounces . . . . . . . . . . . . . . . . . -

Direct labor: 4,000 hours at $9.75 per hour . . . . . . . . . . . . . . . . . $39,000

Variable manufacturing overhead costs incurred . . . . . . . . . . . . . $20,800

Required:

Question 1: Compute the direct materials, direct labor, and variable manufacturing overhead variances.

Novex Company keeps careful track of the time to complete customer orders. During the most recent quarter, the following average times were recorded for each unit or order:

Days

Wait time . . . . . . . . . . . . 17.0

Inspection time . . . . . . . . 0.4

Process time . . . . . . . . . .2.0

Move time . . . . . . . . . . . .0.6

Queue time . . . . . . . . . . .5.0

Goods are shipped as soon as production is completed.

Required:

Question 2: Compute the throughput time.

Question 3: Compute the manufacturing cycle effi ciency (MCE).

Question 4:  What percentage of the production time is spent in non-value-added activities?

Question 5: Compute the delivery cycle time.