8. The Pickwick Company’s production director and marketing director are currently negotiating next year’s production and sales plans. The marketing director confidently forecasts a major sales increase to the levels below:

a. Assume that the beginning inventory is 200 units and the target ending inventory for the fourth quarter is 200 units. What production each quarter will provide a level production plan?

b. If average variable cost per unit for items produced by Pickwick is $500, what will be the monetary value of the finished-goods inventory at the end of the second quarter if it uses a level production plan?

c. If average variable labor cost per unit for the items produced by Pickwick is $200 and average wage rate is $5 per hour, what is the quarterly labor budget in hours and in dollars for a level production plan?

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