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	$26.00 per hr.
	standard time per unit	2.5 hrs.
Direct materials (oak):	standard price	$10.00 per bd. ft.
	standard quantity	17 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. $per table

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

Budget Performance Report

Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry. The cost standards per 100 two-liter bottles are as follows:

Cost Category		Standard Cost per 100 Two-Liter Bottles
Direct labor			$1.56
Direct materials			5.34
Factory overhead			0.3
	Total		$7.2

At the beginning of July, GBC management planned to produce 590,000 bottles. The actual number of bottles produced for July was 637,200 bottles. The actual costs for July of the current year were as follows:

Cost Category		Actual Cost for the Month Ended July 31
Direct labor						$9,742
Direct materials						33,210
Factory overhead						1,931
	Total					$44,883

Enter all amounts as positive numbers.

a. Prepare the July manufacturing standard cost budget (direct labor, direct materials, and factory overhead) for WBC, assuming planned production.

Genie in a Bottle Company
Manufacturing Cost Budget
For the Month Ended July 31
	Standard Cost at Planned Volume(590,000 Bottles)
Manufacturing costs:
Direct labor	$
Direct materials
Factory overhead
Total	$

b. Prepare a budget performance report for manufacturing costs, showing the total cost variances for direct materials, direct labor, and factory overhead for July. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. If required, round your answers to nearest cent.

Genie in a Bottle Company
Manufacturing Costs-Budget Performance Report
For the Month Ended July 31
	Actual Costs	Standard Cost at Actual Volume(637,200 Bottles)	Cost Variance- (Favorable) Unfavorable
Manufacturing costs:
Direct labor	$	$	$
Direct materials
Factory overhead
Total manufacturing cost	$	$	$

c. The Company's actual costs were $995.4 than budgeted. direct labor and direct material cost variances more than offset a small factory overhead cost variance.