FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Data Screen Corporation is a highly automated manufacturing firm. The vice president of finance has decided that traditional standards are inappropriate for performance measures in an automated environment. Labor is insignificant in terms of the total cost of production and tends to be fixed, material quality is considered more important than minimizing material cost, and customer satisfaction is the number one priority. As a result, production and delivery performance measures have been chosen to evaluate performance. The following information is considered typical of the time involved to complete and ship orders.
Waiting time:
From order being placed to start of production ..................................... 8.0 days
From start of production to completion ..................................................... 7.0 days
Inspection time ....................................................................... .............................. 1.5 days
Processing time ........................................................................ ............................. 3.0 days
Move time ................................................................................................................ 2.5 days
Required:
1. Calculate the manufacturing cycle efficiency.
2. Calculate the delivery cycle time.
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