The director of cost management for Odessa Company uses a statistical control chart to help management determine when to investigate variances. The critical value is 1 standard deviation. The company incurred the following direct-labor efficiency variances during the first six months of the current year.

January	$	250	F
February		800	U
March		700	U
April		900	U
May		1,050	U
June		1,200	U

The standard direct-labor cost during each of these months was $19,000. The controller has estimated that the firms monthly direct-labor variances have a standard deviation of $950.

Required:

2-a. Determine the cutoff value for investigation if the controllers rule of thumb is to investigate all variances equal to or greater than 6 percent of standard cost.

2-b. Based on the cutoff value, which month will have its direct-labor efficiency variance investigated?