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Outback, Ltd., manufactures tactical LED flashlights in Melbourne, Australia. The firm uses an absorption-costing system for internal reporting purposes; however, the company is considering using variable costing. Data regarding planned and actual operations for 20x4 follow:

	Budgeted Costs
	Per Unit			Total			Actual Costs
Direct material	$	12.90		$	1,741,500		$	1,599,600
Direct labor		9.60			1,296,000			1,190,400
Variable manufacturing overhead		4.60			621,000			570,400
Fixed manufacturing overhead		4.10			553,500			564,500
Variable selling expenses		7.70			1,039,500			893,200
Fixed selling expenses		7.50			1,012,500			1,012,500
Variable administrative expenses		2.10			283,500			243,600
Fixed administrative expenses		2.60			351,000			360,000
Total	$	51.10		$	6,898,500		$	6,434,200

	Planned Activity		Actual Activity
Sales in units	135,000		116,000
Production in units	135,000		124,000
Beginning finished-goods inventory in units	40,000		40,000

The budgeted per-unit cost figures were based on the company producing and selling 135,000 units in 20x4. Outback uses a predetermined overhead rate for applying manufacturing overhead to its product. A total manufacturing overhead rate of $8.70 per unit was employed for absorption costing purposes in 20x4. Any overapplied or underapplied manufacturing overhead is closed to the Cost of Goods Sold account at the end of the year. The 20x4 beginning finished-goods inventory for absorption costing purposes was valued at the 20x3 budgeted unit manufacturing cost, which was the same as the 20x4 budgeted unit manufacturing cost. There are no work-in-process inventories at either the beginning or the end of the year. The planned and actual unit selling price for 20x4 was $70.10 per unit.

1.	Compute the value of Outback