Cedar Designs Company,a Custom Cabinet Manufacturing Company,is Setting Standard Costs

question 106

Multiple Choice

Cedar Designs Company,a custom cabinet manufacturing company,is setting standard costs for one of its products.The main material is cedar wood,sold by the square foot.The current cost of cedar wood is $6.00 per square foot from the supplier.Delivery costs are $0.25 per square foot.Carpenters' wages are $30.00 per hour.Payroll costs are $3.60 per hour,and benefits are $6.00 per hour.How much is the direct labor standard cost per hour?

• A)$30.00
• B)$9.60
• C)$33.60
• D)$39.60

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Definitions:

Annual Revenue

The total amount of money earned from the sale of goods or services in a fiscal year before any expenses are subtracted.

Annual Expenses

The total amount of money spent or costs incurred by a business or individual in a one-year period.

Capital Budgeting

The process by which an organization evaluates and selects long-term investments that are in line with their goal of wealth maximization.

Long-term Decisions

Decisions that impact an organization over an extended period, usually beyond one year, involving investments, strategic direction, and structural changes.