Kelly Company manufactures and sells one product. The following information pertains to each of the companys first two years of operations: Variable cost per unit: Direct materials $ 10.00 Fixed costs per year: Direct labor $ 382,500 Fixed manufacturing overhead $ 457,500 Fixed selling and administrative expenses $ 182,000 The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, Kelly produced 51,000 units and sold 40,750 units. During its second year of operations, it produced 51,000 units and sold 61,250 units. The selling price of the companys product is $42 per unit. Required: 1. Assume the company uses