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need answer with calculations Sunland Industries had sales in 2021 of $5,624,000 and gross profit of $1,093,000. Management is considering two alternative budge plans to
need answer with calculations
Sunland Industries had sales in 2021 of $5,624,000 and gross profit of $1,093,000. Management is considering two alternative budge plans to increase its gross profit in 2022. Plan A would increase the selling price per unit from $8.00 to $8.40, Sales volume would decrease by 10% from its 2021 level. Plan 8 would decrease the selling price per unit by $0.50. The marketing department expects that the sales volume would increase by 101,000 units. At the end of 2021, Sunland has 38,000 units of inventory on hand. If Plan A is accepted, the 2022 ending inventory should be equal to 5% of the 2022 sales. If Plan B is accepted, the ending inventory should be equal to 57,000 units. Each unit produced will cost $1.70 in direct labour, $1.40 in direct materials, and $1.10 in variable overhead, The fixed overhead for 202.2 should be $1.913.000. SUNLAND INDUSTRIES Production Budget For the Year Ending December 31, 2022 Plan A Plan B Step by Step Solution
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