=+Beginning inventory 230 kilograms 70 kilograms Target ending inventory 400 kilograms 65 kilograms Cost of beginning inventory $874 $224 Elite Pet Transport accounts for direct materials using a FIFO cost flow assumption.

Sales and inventory information, finished goods Cat-allac Dog-eriffic Expected sales in units 580 240 Selling price $190 $275 Target ending inventory in units 45 25 Beginning inventory in units 25 40 Beginning inventory in dollars $2500 $7440 Elite Pet Transport uses a FIFO cost flow assumption for finished goods inventory.

Elite Pet Transport uses an activity-based costing system and classifies overhead into three activity pools: set-up, processing and inspection. Activity rates for these activities are $130 per set-up hour, $5 per machine-hour and $20 per inspection-hour, respectively.

Other information follows.

Cost driver information Cat-allac Dog-eriffic Number of units per batch 25 13