Artscapes Company Is Setting Its Direct Materials and Direct Labor

question 140

Multiple Choice

Artscapes Company is setting its direct materials and direct labor standards for its leading product. Materials cost from the supplier are $4.50 per square foot, net of purchase discount. Freight-in amounts to $0.10 per square foot. Basic wages of the assembly line personnel are $12.00 per hour. Payroll taxes are approximately 20% of wages. Benefits amount to $3.00 per hour. How much is the direct material price standard (per square foot) ?

• A) $4.60 per square foot
• B) $4.00 per square foot
• C) $3.90 per square foot
• D) $16.50 per square foot

---

Definitions:

Test Markets

Regional markets or demographic groups used for launching new products to evaluate consumer response before a national rollout.

Competitors

Businesses or individuals that compete within the same market for resources and customers.

Information Technology

Includes all of the computing resources that collect, store, and analyze data.

Nonpersonal Source

A communication or marketing message delivered through media or other channels that do not involve personal contact or direct interaction.