2. Stair Company had sales in 2014 of $6,400,000 and gross profit of $1,100,000. Management is considering two alternative budget plans to increase gross profit in 2020. Plan A would increase the selling price per unit from $8.00 to $8.50. Sales volume would decrease by 10% from its 2014 level. Plan B would decrease the selling price per unit by $0.60. The marketing department has estimated that this would result in an increase in sales volume of 100,000 units. At the end of 2014, Stair has 38,000 units of inventory on hand. If Plan A is accepted, the 2015 ending inventory should be equal to 5% of 2015 sales. If Plan B is accepted, the ending inventory should be equal to 60,000 units. Each unit produced will cost $1.80 in direct labor, $1.30 in direct materials, and $1.20 in variable overhead. The fixed overhead for 2015 should be $1,895,000. Instructions a. Prepare a sales budget for 2020 under each plan. b. Prepare a production budget for 2020 under each plan. C. Calculate the production cost per unit under each plan. (Round to two decimals.) Why is the cost per unit different under each of the two plans? d. Which plan should be accepted? (Compute the gross profit under each plan to help with this decision.)