Question

Standard Product Cost

Designer Furniture Company manufactures designer home furniture. Designer Furniture uses a standard cost system. The direct labor, direct materials, and factory overhead standards for a finished dining room table are as follows:

Line Item Description Classification Value
Direct labor: standard rate $30.00 per hr.
Direct labor: standard time per unit 5.0 hrs.
Direct materials (oak): standard price $8.00 per bd. ft.
Direct materials (oak): standard quantity 20 bd. ft.
Variable factory overhead: standard rate $0.75 per direct labor hr.
Fixed factory overhead: standard rate $1.15 per direct labor hr.


a. Determine the standard cost per dining room table.

Answer 1

The standard cost per dining room table is calculated by adding the costs of direct labor ($150), direct materials ($160), variable overhead ($3.75), and fixed overhead ($5.75) to get a total of $319.50.

Step-by-step explanation:

To determine the standard cost per dining room table for Designer Furniture Company, we need to calculate the total cost by adding the standard costs for direct labor, direct materials, and both variable and fixed factory overheads.

The standard cost calculations are as follows:

Direct labor cost: $30.00 per hour × 5.0 hours = $150

Direct materials cost: $8.00 per board foot × 20 board feet = $160

Variable overhead cost: $0.75 per direct labor hour × 5.0 hours = $3.75

Fixed overhead cost: $1.15 per direct labor hour × 5.0 hours = $5.75

Adding these costs together gives us the total standard cost for one table:

Total standard cost = $150 + $160 + $3.75 + $5.75 = $319.50.