1. Standard Product Cost

   Sana Rosa Company manufactures unfinished 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	$18.00 per hr.
   	standard time per unit	3.5 hrs.
   Direct materials (oak):	standard price	$8.00 per bd. ft.
   	standard quantity	20 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 1per table

   b. A standard cost system provides Sana Rosa management a cost control tool using the principle of

   cost controlmanagement by exceptionmanagement by exception

   . Using this principle,

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   cost deviations from standards can be investigated and corrected.

   Feedback

   Remember the process discussed in chapter for calculating standard cost.

   Review the benefits of standard cost systems.

   Learning Objective 2.

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