Bambino Sporting Goods makes baseball gloves that are very popular in the spring and early summer season. Units sold are anticipated as follows:

March....................................................... 325,000

April......................................................... 925,000

May.......................................................... 1,300,000

June.......................................................... 1,100,000

If seasonal production is used, it is assumed that inventory will directly match sales for each month and there will be no inventory buildup.

The production manager thinks the preceding assumption is too optimistic and decides to go with level production to avoid being out of merchandise. He will produce the units over four months utilizing level production.

a. What is the ending inventory at the end of each month? Assume zero inventory at the end of February.

b. If the inventory costs $12 per unit and will be financed at the bank at a cost of 9 percent, what is the monthly financing cost and the total financing cost for the four months?