Philly Rug Company Produces Designer Rugs for Clients

Essay

Philly Rug Company produces designer rugs for clients. The standard size rug will require 3
yards of direct materials (DM), 1 hours of direct labor (DL) time, and 2 hours of machine time. MOH costs are applied based on machine hours. DM is expected to cost $8.00 per yard, DL is budgeted at $12 per hour, and cost of machine time is estimated at $3/machine hour for variable-MOH and $2/machine hour for fixed-MOH. Create a standard cost card for a standard size rug for Philly Rug Company to compute the standard cost for one unit of product.