On January $1,2027,$ the Sheridan Company budget committee has reached agreement on the following data for the $6$ months ending SHERIDAN COMPANY

Production Budget

Quarter

June $30,2027.$

Sales units:

Ending raw materials inventory:

Ending finished goods inventory:

Third$-$quarter production:

First quarter $6,700$; second quarter $8,040$; third quarter $9,380.$

$40\%$ of the next quarter's production requirements.

$25\%$ of the next quarter's expected sales units.

$9,730$ units.

The ending raw materials and finished goods inventories at December $31,2026,$ follow the same percentage relationships to

production and sales that occur in $2027.$ Three pounds of raw materials are required to make each unit of finished goods. Raw

materials purchased are expected to cost $$4$ per pound.

$($a$)$