Fundamental Accounting Principles
Fundamental Accounting Principles
23rd Edition
ISBN: 9781259536359
Author: John J Wild, Ken Shaw Accounting Professor, Barbara Chiappetta Fundamental Accounting Principles
Publisher: McGraw-Hill Education
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Chapter 24, Problem 19E
To determine

Introduction:

Manufacturing Cycle Time (MCT): Manufacturing cycle time refers to the time required in converting raw material into finished goods. It is the sum of Process time, Move time, Inspection time, and Queue time.

• Process time: This is the time required for conversion of raw materials into finished goods.

• Move time: The time during which an order moves from one workstation to the next.

• Inspection time: The time spent in examining a product to confirm quality standards.

• Queue time: The waiting time for a job in front of workstations before being processed.

Manufacturing cycle efficiency (MCE): It is the percentage of the time spent in value added activities during manufacturing process.

To Calculate:

Requirement 1: Manufacturing Cycle Time

Expert Solution
Check Mark

Answer to Problem 19E

Solution:

Manufacturing Cycle Time = 50 hrs

Explanation of Solution

Manufacturing cycle time     = Process time + Move time + Inspection time + Queue time                                                = 16+9+3.5+21.5 = 50 hours

To determine

Requirement 2: Manufacturing Cycle Efficiency (MCE)

Expert Solution
Check Mark

Answer to Problem 19E

Solution:

Manufacturing Cycle Efficiency = 32%

Explanation of Solution

MCE  = Process timeManufacturing cycle time           = 1650 = 0.32 = 32%

Conclusion
The company is spending 32% of its manufacturing cycle time in value added activities and rest 68% in no-value added activities.

To determine

Requirement 3: Increasing Manufacturing Cycle Efficiency (MCE)

Expert Solution
Check Mark

Answer to Problem 19E

Solution:

The Manufacturing Cycle Efficiency can be increased to 0.8 either by increasing the process time in the given manufacturing cycle time or by decreasing the manufacturing cycle time with the given process time. Both of this option will result in decreasing the non-value added activities time.

Explanation of Solution

MCE = Process TimeManufacturing cycle time 

If manufacturing cycle time is same i.e; 50 hours; then the process time should be

Process time  = MCE X Manufacturing Cycle time                       = 0.8 X 50                       = 40 hrs

If process time is same i.e; 16 hours; then the manufacturing cycle time should be

Manufacturing Cycle Time   = Process TimeMCE                                                = 160.8/                                                         = 20 hours

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Chapter 24 Solutions

Fundamental Accounting Principles

Ch. 24 - Prob. 11DQCh. 24 - Prob. 12DQCh. 24 - Prob. 13DQCh. 24 - Prob. 14DQCh. 24 - Prob. 15DQCh. 24 - Prob. 16DQCh. 24 - Prob. 17DQCh. 24 - Prob. 18DQCh. 24 - Prob. 19DQCh. 24 - Prob. 20DQCh. 24 - Allocation and measurement terms C1 In each blank...Ch. 24 - Basis for cost allocation C1 For each of the...Ch. 24 - Prob. 3QSCh. 24 - Prob. 4QSCh. 24 - Prob. 5QSCh. 24 - Prob. 6QSCh. 24 - Prob. 7QSCh. 24 - Prob. 8QSCh. 24 - Prob. 9QSCh. 24 - Prob. 10QSCh. 24 - Prob. 11QSCh. 24 - Prob. 12QSCh. 24 - Prob. 13QSCh. 24 - Prob. 14QSCh. 24 - Prob. 15QSCh. 24 - Prob. 16QSCh. 24 - Prob. 17QSCh. 24 - Prob. 18QSCh. 24 - Prob. 19QSCh. 24 - Prob. 20QSCh. 24 - Exercise 24-1 Responsibility accounting...Ch. 24 - Exercise 24-2 Responsibility accounting...Ch. 24 - Exercise 24-3 Service department expenses...Ch. 24 - Prob. 4ECh. 24 - Prob. 5ECh. 24 - Prob. 6ECh. 24 - Prob. 7ECh. 24 - Prob. 8ECh. 24 - Prob. 9ECh. 24 - Prob. 10ECh. 24 - Prob. 11ECh. 24 - Prob. 12ECh. 24 - Prob. 13ECh. 24 - Prob. 14ECh. 24 - Prob. 15ECh. 24 - Prob. 16ECh. 24 - Prob. 17ECh. 24 - Prob. 18ECh. 24 - Prob. 19ECh. 24 - Prob. 20ECh. 24 - Prob. 21ECh. 24 - Prob. 22ECh. 24 - Prob. 23ECh. 24 - Problem WA Responsibility according perfortmance...Ch. 24 - Prob. 2APSACh. 24 - Prob. 3APSACh. 24 - Problem 24-4A Departmental contribution to income...Ch. 24 - Prob. 5APSACh. 24 - Prob. 1BPSBCh. 24 - Prob. 2BPSBCh. 24 - Prob. 3BPSBCh. 24 - Prob. 4BPSBCh. 24 - Prob. 5BPSBCh. 24 - Prob. 24SPCh. 24 - Prob. 1BTNCh. 24 - Prob. 2BTNCh. 24 - Prob. 3BTNCh. 24 - Prob. 4BTNCh. 24 - Prob. 5BTNCh. 24 - Prob. 6BTNCh. 24 - Prob. 7BTNCh. 24 - Prob. 8BTNCh. 24 - Prob. 9BTN
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