1. Each CamDrone requires 1.25kg of direct materials. During 2019, the average cost of direct materials was $57/kg. The supplier of the direct materials tends to be somewhat erratic, so CamDrone finds it necessary to maintain a direct materials inventory balance equal to 40% of the following months production needs as a precaution against stock-outs. 2. Due to the similarity of the equipment in each of the production stages and the companys concentration on a single product, manufacturing overhead is allocated based on volume (i.e. the units produced). The variable manufacturing overhead rate for 2019 is $160/unit, consisting of: Plant & Equipment Maintenance $ 70 Utilities 40 Indirect Materials 30 Other 20 $ 160 3. The fixed manufacturing overhead costs for 2019 are as follows: Supervisors salary 181,800 Amortization of Plant & Equipment $ 132,000 Insurance 84,000 Training & Development 54,750 Property and Business Taxes 48,000 Other 30,000 $ 530,550 Amortization is calculated using the straight-line method, with no amortization calculated in the year capital assets are acquired. 4. Aside from amortization, all other manufacturing costs are expected to increase by 3% in 2020 due to inflation.