Martinez Industries had sales in 2016 of $7,120,000 and gross profit of $1,121,000. Management is considering two alternative budget plans to increase its gross profit in 2017. Plan A would increase the selling price per unit from $8.00 to $8.40. Sales volume would decrease by 10% from its 2016 level. Plan B would decrease the selling price per unit by $0.50. The marketing department expects that the sales volume would increase by 120,000 units. At the end of 2016, Martinez has 48,000 units of inventory on hand. If Plan A is accepted, the 2017 ending inventory should be equal to 5% of the 2017 sales. If Plan B is accepted, the ending inventory should be equal to 61,000 units. Each unit produced will cost $1.80 in direct labor, $1.40 in direct materials, and $1.20 in variable overhead. The fixed overhead for 2017 should be $1,108,000. (d) fo - Your answer is partially correct. Compute the gross profit under each plan. Gross Profit Plan A Plan B 2053800 1996040 Which plan should be accepted? Plan A should be accepted. eTextbook and Media Save for Later Attempts: 1 of 3 used Submit