Spaworks Inc. makes hot tubs for residential use. The hot tubs, which consist of a fibreglass finish and proprietary insulation glass, are sold with an all-weather pump and heater unit for $2,?50. The company is planning its annual budget for the coming year ending October 31, 2020, and the controller has provided the following data: Sales F2020 15,000 tubs F2021 November sales: 1,800 tubs; December sales: 1,500 tubs Selling price per tub: $2,750.00 Materials and labour requirements (per tub) Direct materials Insulation 5.0 kg Fibreglass 10.4 sq. metre (m2) Pumps 1 unit Direct labour 8 hours Inventories Beginning: Qty Units Cost Finished goods 550 unit $1,400.00 Direct materials Insulation 2,195 kg $15.00 Fibreglass 6,500 m2 $12.00 Pumps 550 unit $850.00 Ending finished goods inventory is 25% of next month's sales. Ending direct materials inventories are 20% of next month's production needs. Direct materials inventory is expected to change to the following: Insulation $ 16.00 per kg Fibreglass $ 13.00 per square metre Pumps $900.00 per unit Other rates Direct labour wage rate $22.50 per hour Variable manufacturing overhead $26.00 per direct labour hour Variable marketing costs $250 per customer Number of customers 15,000 Other costs Fixed manufacturing overhead $319,275 Fixed non-manufacturing costs $1,250,000