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Standard Product Cost Atlas Furniture Company manufactures designer home furniture. Atlas uses a standard cost system. The direct labor, direct materials, and factory overhead standards
Standard Product Cost
Atlas Furniture Company manufactures designer home furniture. Atlas 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 $28.00 per hr. standard time per unit 5.0 hrs. Direct materials (oak): standard price $12.00 per bd. ft. standard quantity 18 bd. ft. Variable factory overhead: standard rate $2.00 per direct labor hr. Fixed factory overhead: standard rate $3.80 per direct labor hr.
a. Determine the standard cost per dining room table. $ per table
b. A standard cost system provides Atlas Furniture Company's management a cost control tool using the principle of management by exception . Using this principle, major cost deviations from standards can be investigated and corrected.
Standard Product Cost
Atlas Furniture Company manufactures designer home furniture. Atlas 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 | $28.00 per hr. |
standard time per unit | 5.0 hrs. | |
Direct materials (oak): | standard price | $12.00 per bd. ft. |
standard quantity | 18 bd. ft. | |
Variable factory overhead: | standard rate | $2.00 per direct labor hr. |
Fixed factory overhead: | standard rate | $3.80 per direct labor hr. |
a. Determine the standard cost per dining room table. $
b. A standard cost system provides Atlas Furniture Company's management a cost control tool using the principle of
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