Final answer:
To establish the money rate per hundred pieces, the cost per piece is calculated incorporating the allowances and performance rating, then multiplied by a hundred. The subject matter deals with time studies and labor costing in the context of manufacturing economics.
Step-by-step explanation:
To establish the money rate per hundred pieces using the provided cycle time, base rate, and performance rating, we first identify the cost per piece and then scale that amount to a hundred pieces. The cycle time is 1.23 minutes, and with four pieces produced per cycle, each piece took an average of 0.3075 minutes to produce. Moreover, there are allowances for both effort time (17%) and power feed time (12%), and the performance rating is 88% which we'll need to adjust the time worked effectively.
To calculate the total time including allowance, we calculate the effort allowance added to the effective manual time (1.23 - 0.52) and the power feed allowance for the machine time. Then, we adjust for the performance rating by dividing by 0.88 to get the total paid time per piece. After obtaining the total time for one piece, we multiply the time by the base rate of $8.60 per hour to get the labor cost per piece. We subsequently determine the cost per hundred pieces.
It's important to note that the cycle doesn't involve a machine cost, but when considering broader manufacturing considerations, details such as cost of labor plus the cost of machine come into play, potentially altering the economics of production as indicated in the examples provided which discuss the impacts of labor costs and machine costs.