Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Bonita Industries had sales in 2021 of $5.684,800 and gross profit of $919,600. Management is considering two alternative budget plans to increase its gross profit

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Bonita Industries had sales in 2021 of $5.684,800 and gross profit of $919,600. Management is considering two alternative budget plans to increase its gross profit in 2022. Plan A would increase the unit selling price from $8.00 to $8.40. Sales volume would decrease by 104,500 units from its 2021 level. Plan B would decrease the unit selling price by $0.50. The marketing department expects that the sales volume would increase by 108,680 units. At the end of 2021, Bonita has 33,440 units of inventory on hand. If Plan A is accepted, the 2022 ending inventory should be 29.260 units. If Plan B is accepted, the ending inventory should be equal to 50,160 units. Each unit produced will cost $1.5 in direct labor. $1.3 in direct materials, and $1.2 in variable overhead. The fixed overhead for 2022 should be $1,584,220. BONITA INDUSTRIES Sales Budget Hedernan an Compute the production cost per unit under each plan. (Round answers to 2 decimal places, e.g. 1.25.) eTextbook and Media Attempts: 0 of 2L (d). Compute the gross profit under each plan. (Round answers to 0 decimal places, e.g. 125.) Compute the gross profit under each plan. (Round answers to 0 decimal places, e.g. 12 Which plan should be accepted

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Tools for business decision making

Authors: kimmel, weygandt, kieso

4th Edition

978-0470117262, 9780470534786, 470117265, 470534788, 978-0470095461

More Books

Students also viewed these Accounting questions

Question

What are they doing well?

Answered: 1 week ago