Beginning-of-year balances Cash Accounts receivables (previous quarter's sales) Raw materials Finished Goods Accounts payable $50,000 $61,200 653 Kits 510 Units $33,255 Desired end-of-year inventory balances Raw materials Finished goods 500 kits 270 units Desired end-of-quarter balances Raw materials as a portions of the following quarter's production Finished goods as a portion of the following quarter's sales 20% 15% Manufacturing costs other than raw materials are paid in month incurred unless it is an noncash expense Total Unit of input Variable Standard cost per unit Raw materials Direct labor hours at rate Variable overhead/labor hour Total Variable Standard cost per unit 1 kit 0.8 hour 0.8 hour per input unit $50 $25 $10 Unit price cost per $50 $8 $20 $78 Fixed overhead cost per quarter used cash Manufacturing Depreciation per quarter $50,000 $10,000 Selling and administrative costs are paid in month incurred unless it is an noncash expense Variable cost per unit Fixed selling and administrative cost per quarter used cash Selling and administrative depreciation per quarter $6 $25,000 $5,000