cans, which she Malarie has developed a line of frozen lemonade in convenient 1-cup sized sells to other little kids who want to set up lemonade stands. Her projected sales for the upcoming quarter are as follows: Projected sales: April May June 1,000 cups 1,200 cups 1,500 cups In addition, she estimates July sales of 2,000 cans. The following information is available: A. The sales price is estimated to be $3 per cup (can actually). B. Malarie has developed the following standards for the production of ONE glass-can of lemonade: Direct Materials: Lemons Cups Direct Labor 2/glass @ 1 /glass @ 0.05 hrs @ 0.3 per lemon 0.2 per cup $10 per hour C. Malarie wishes to maintain safety stock of completed lemonades ONLY. She uses a JIT system for all materials. All cans of lemonades are finished right after they are started and, therefore, there is never any work-in-process inventory. D. For the completed lemonades, she maintains 20% of next month's estimated production. Beginning inventory as of April 1 was 200 cans. E. Malarie expects variable overhead (other supplies) will be $.20 per cup, fixed overhead $195 per month and incurs $100 per month of other operating expenses (selling and administrative in nature). None of these expenses are depreciation expense. Required: 1. It says that Malarie uses a "JIT system for raw materials inventory. What's that mean? Why might they wish to do that? 2. It mentions above that the company had standards for both direct materials and direct labor. What's a standard? Why is that important? How are they arrived at?