Cullumber Industries' balance sheet at December 31, 2019, is presented below. CULLUMBER INDUSTRIES Balance Sheet December 31, 2019 Assets Current Assets Cash Accounts receivable Finished goods inventory (1,500 units) Total current assets $7,500 73,500 26,210 107,210 Property, Plant, and Equipment Equipment $40,260 Less: Accumulated depreciation 10,420 29,840 Total assets $137,050 Liabilities Notes payable Liabilities and Stockholders' Equity Accounts payable Total liabilities Stockholders' Equity $26,220 45,730 71,950 Common stock $37,190 Retained earnings 27,910 Total stockholders' equity 65,100 Total liabilities and $137,050 stockholders' equity Budgeted data for the year 2020 include the following. 2020 Quarter 4 Total Sales budget (8,000 units at $32) $76,800 $256,000 Direct materials used 13,480 62,500 Direct labor 12,500 50,900 Manufacturing overhead applied 10,000 48,600 Selling and administrative expenses 17,760 75,000 To meet sales requirements and to have 2,500 units of finished goods on hand at December 31, 2020, the production budget shows 9,000 required units of output. The total unit cost of production is expected to be $18. Cullumber uses the first-in, first-out (FIFO) inventory costing method. Interest expense is expected to be $3,500 for the year. Income taxes are expected to be 40% of income before income taxes. In 2020, the company expects to declare and pay an $8,460 cash dividend. The company's cash budget shows an expected cash balance of $5,880 at December 31, 2020. All sales and purchases are on account. It is expected that 60% of quarterly sales are collected in cash within the quarter and the remainder is collected in the following quarter. Direct materials purchased from suppliers are paid 50% in the quarter incurred and the remainder in the following quarter. Purchases in the fourth quarter were the same as the materials used. In 2020, the company expects to purchase additional equipment costing $10,340. $4,846 of depreciation expense on equipment is included in the budget data and split equally between manufacturing overhead and selling and administrative expenses. Cullumber expects to pay $8,450 on the outstanding notes payable balance plus all interest due and payable to December 31 (included in interest expense $3,500, above). Accounts payable at December 31, 2020, includes amounts due suppliers (see above) plus other accounts payable relating to manufacturing overhead of $8,530. Unpaid income taxes at December 31 will be $6,680.