Chataqua Can Company manufactures metal cans used in the food-processing industry. A case of cans sells for $30. The variable costs of production for one case of cans are as follows: Direct material Direct labor Variable manufacturing overhead 6.00 2.00 7.00 $15.00 Total variable manufacturing cost per case Variable selling and administrative costs amount to $0.80 per case. Budgeted fixed manufacturing overhead is $623,000 per year, and fixed selling and administrative cost is $45,000 per year. The following data pertain to the company's first three years of operation. Planned production (in units) Finished-goods inventory (in units), January 1 Actual production (in units) Sales (in units) Finished-goods inventory (in units), December 31 Year 1 Year 2 Year 3 89,000 89,000 89,000 0 27,500 89,000 89,000 89,000 89,000 61,500 102,750 0 27,500 13,750 Actual costs were the same as the budgeted costs