MaxiDrive manufactures a wide variety of parts for recreational boating, including a gear and driveshaft part for high-powered outboard boat engines. Original equipment manufacturers such as Mercury and Honda purchase the components for use in large, powerful outboards. The part sells for $615, and sales volume averages 25,500 units per year. Recently, MaxiDrive's major competitor reduced the price of its equivalent unit to $552. The market is very competitive, and MaxiDrive realizes it must meet the new price or lose significant market share. Management has begun paying closer attention to costs and has reconfirmed the current existing standard costs. The controller then assembled the following cost and usage data for the most recent year for MaxiDrive's production of 25,500 units:

Direct materials 5 6,559,999 S 7,959,999 Direct labor 2,515,\" 2,659,999 Indirect labor 2,529,999 2,425,999 Inspection (hours and cost) 949 319,999 1,959 355,999 Materials handling (number of purchases and cost) 3,659 525,999 3,599 519,999 Machine setups (number and cost) 1,459 775,999 1,559 759,999 Returns and rework (number of times and cost) 319 85,999 519 135,999 $13,299,999 $13,875,999