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$23.00 per hr. standard time per unit2.50 hrs.Direct materials (oak):standard price$8.00 per bd. ft. standard quantity19 bd. ft.Variable factory overhead:standard rate$2.40 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 . Using this principle, cost deviations from standards can be investigated and corrected.

Standard cost per dining room table = $ 218.50 Part b) A standard cost system provides Rosa…

Answered: Sana Rosa Furniture Company…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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	$23.00 per hr.
	standard time per unit	2.50 hrs.
Direct materials (oak):	standard price	$8.00 per bd. ft.
	standard quantity	19 bd. ft.
Variable factory overhead:	standard rate	$2.40 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

. Using this principle,

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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