1. Golf Pro Inc. makes wood drivers for the professional golfer. Because of the

Question

1.     Golf Pro Inc. makes wood drivers for the professional golfer. Because of the clientele of users, only the finest materials can be used, and the quality of craftsmanship must be high. The following cost, quantity, and time standards have been set for 2014:

Direct materials: 2 board-feet of wood @ $20 per board-foot and 2 feet of leather strip @ $5 per foot

Direct labor: Cutting Department, 0.6 hour per driver at $10 per hour; Shaping/Finishing Department, 1.4 hours per driver at $15 per hour

Overhead: variable, $5 per direct labor hour; fixed, $8 per direct labor hour

The wood is added at the beginning of the cutting process and the leather strip at the beginning of the shaping/finishing process.

Compute the standard cost per driver.

Explanation / Answer

Standard cost

Direct materials: 2 board-feet of wood @ $20 per board-foot = 2*20 = 40 dollar

and 2 feet of leather strip @ $5 per foot = 2*5 = 10 dollar

Direct labor: Cutting Department, 0.6 hour per driver at $10 per hour = 0.6*10 = 6 dollar

Shaping/Finishing Department, 1.4 hours per driver at $15 per hour = 1.4* 15 = 21 dollar

Total hours = 0.6 + 1.4 = 2 hours

Overhead: variable, $5 per direct labor hour; for 2 hours = 5*2 = 10 dollar

fixed, $8 per direct labor hour = 8* 2 = 16 dollar

Total cost is summation of all the costs above = 103 dollars = Answer

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