Wallis Company manufactures only one product and uses a standard cost system. The company uses a predetermined plantwide overhead rate that relies on direct labor-hours as the allocation base. All of the company's manufacturing overhead costs are fixed-it does not incur any variable manufacturing overhead costs. The predetermined overhead rate is based on a cost formula that estimated $2,888,000 of fixed manufacturing overhead for an estimated allocation base of 288,800 direct labor-hours. Wallis does not maintain any beginning or ending work in process inventory. The company's beginning balance sheet is as follows: Wallis Company Balance Sheet 1/1/xx (dollars in thousands) Assets Cash Raw materials inventory Finished goods inventory Property, plant, and equipment, net Total assets Liabilities and Equity Retained earnings Total liabilities and equity $780 230 350 9,300 $ 10,660 $ 10,660 $ 10,660 The company's standard cost card for its only product is as follows: Inputs Direct materials Direct labor Total standard cost per unit Fixed manufacturing overhead (3) (2) Standard Quantity Standard Price or or Hours 2 pounds 3.00 hours 3.00 hours Rate $ 31.60 per pound $ 13.00 per hour $ 10.00 per hour Standard Cont (1) (2) $63.20 39.00 30.00 $132.20