Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost. Jackson has established the following standards for one unit of product:

Standard Quantity or HoursStandard Price or RateStandard Cost Per Unit

Direct materials5pounds$4.10per pound$20.50

Direct labor2.30hours$15.00per hour$34.50

During May, Jackson purchased 118,100 pounds of direct material at a total cost of $507,830. The total factory wages for May were $764,800, 90 percent of which were for direct labor. Jackson manufactured 20,000 units of product during May using 96,900 pounds of direct material and 46,720 direct labor-hours. The labor efficiency variance for May is:

$10,800 Favorable

$9,600 Unfavorable

$10,800 Unfavorable

$8,400 Favorable

Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost. Jackson has established the following standards for one unit of product:

	Standard Quantity or Hours		Standard Price or Rate		Standard Cost Per Unit
Direct materials	5	pounds	$4.10	per pound	$20.50
Direct labor	2.30	hours	$15.00	per hour	$34.50

During May, Jackson purchased 118,100 pounds of direct material at a total cost of $507,830. The total factory wages for May were $764,800, 90 percent of which were for direct labor. Jackson manufactured 20,000 units of product during May using 96,900 pounds of direct material and 46,720 direct labor-hours. The labor efficiency variance for May is:

$10,800 Favorable

$9,600 Unfavorable

$10,800 Unfavorable

$8,400 Favorable

Gilder Corporation makes a product with the following standard costs:

	Standard Quantity or Hours		Standard Price or Rate				Standard Cost Per Unit
Direct materials	7.80	grams	$9.00	per gram			$70.20
Direct labor	0.10	hours	$27.00	per hour			$ 2.70
Variable overhead	0.10	hours	$ 7.00	per hour			$ 0.70

The company reported the following results concerning this product in June:

Originally budgeted output	4,700	units
Actual output	4,920	units
Raw materials used in production	34,648	grams
Purchases of raw materials	38,848	grams
Actual direct labor-hours	460	hours
Actual cost of raw materials purchases	$330,210
Actual direct labor cost	$12,015
Actual variable overhead cost	$988

The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The labor efficiency variance for June is:

$864 F

$836 U

$836 F

$220 U

Nash Corporation manufactures and sells custom snowmobiles. From the time an order is placed till the time the snowmobile reaches the customer averages 50 days. This 50 days is spent as follows:

Wait time	3.5	days
Move time	17.6	days
Process time	10.4	days
Queue time	2.6	days
Inspection time	0.5	days

What is Nash's manufacturing cycle efficiency (MCE) for its snowmobiles?

rev: 08_01_2016_QC_CS-56603, 08_02_2016_QC_CS-56603

23%

33%

9%

10%