2. Step 2: Normal Time (NT): Since every worker operates at a different speed, the observed time must be adjusted by a "Performance Rating Factor" (RF) to represent the time an average, qualified worker would take.
$$\text{Normal Time} = \text{Observed Time} \times \text{Rating Factor}$$
3. Step 3: Standard Time (ST): Workers require time for personal needs, fatigue, and unavoidable delays. These "Allowances" are added to the normal time. Allowances are typically expressed as a percentage of the normal time.
$$\text{Standard Time} = \text{Normal Time} + \text{Allowances}$$
$$\text{Standard Time} = \text{Normal Time} \times (1 + \text{Allowance \%})$$
4. The Combined Formula: By substituting the formula for Normal Time into the final equation, we arrive at:
$$\text{Standard Time} = \text{Observed Time} \times \text{Rating Factor} \times (1 + \text{Allowances})$$