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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 $17.00 per hr.
standard time per unit 4 hrs.
Direct materials (oak): standard price $8.00 per bd. ft.
standard quantity 17 bd. ft.
Variable factory overhead: standard rate $2.40 per direct labor hr.
Fixed factory overhead: standard rate $0.80 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 1per table

b. A standard cost system provides Atlas Furniture Companys management a cost control tool using the principle of

cost controlmanagement by exception

. Using this principle,

majorminor

cost deviations from standards can be investigated and corrected.

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