Standard Product CostSana Rosa Furniture Company manufactures designer home furniture. Sana Rosa uses a standard cost system. The direct labor, direct materials, and factory overhead standards for an unfinished dining room table are as follows:Direct labor:standard rate$20.00 per hr. standard time per unit3.00 hrs.Direct materials (oak):standard price$10.00 per bd. ft. standard quantity18 bd. ft.Variable factory overhead:standard rate$2.80 per direct labor hr.Fixed factory overhead:standard rate$1.20 per direct labor hr.a. Determine the standard cost per dining room table. If required, round your answer to two decimal places.$fill in the blank 1 per dining room tableb. A standard cost system provides Rosa Furniture management a cost control tool using the principle of cost control . Using this principle, minor cost deviations from standards can be investigated and corrected.

Standard cost is an estimated cost determined by the company for the production of goods and…

Answered: Standard Product Cost Sana Rosa…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter9: Evaluating Variances From Standard Costs

Section: Chapter Questions

Problem 2E

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Standard Product Cost

Sana Rosa Furniture Company manufactures designer home furniture. Sana Rosa uses a standard cost system. The direct labor, direct materials, and factory overhead standards for an unfinished dining room table are as follows:

Direct labor:	standard rate	$20.00 per hr.
	standard time per unit	3.00 hrs.
Direct materials (oak):	standard price	$10.00 per bd. ft.
	standard quantity	18 bd. ft.
Variable factory overhead:	standard rate	$2.80 per direct labor hr.
Fixed factory overhead:	standard rate	$1.20 per direct labor hr.

a. Determine the standard cost per dining room table. If required, round your answer to two decimal places.
$fill in the blank 1 per dining room table

b. A standard cost system provides Rosa Furniture management a cost control tool using the principle of cost control . Using this principle, minor cost deviations from standards can be investigated and corrected.

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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