P23-3A Hill Industries had sales in 2016 of $6,800,000 and gross profit of $1,100,000. Prepare sa Management is considering two alternative budget plans to increase its gross profit budgets an in 2017. unit unde 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 100,000 units. (LO2) At the end of 2016, Hill has 40,000 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 60,000 units. Each unit produced will cost $1.80 in direct labor, $1.40 in direct materials, and $1.20 in variable overhead. The fixed over head for 2017 should be $1,895,000. Instructions (a) Prepare a sales budget for 2017 under each plan. (b) Prepare a production budget for 2017 under each plan. (c) Compute the production cost per unit under each plan. Why is the cost per unit different (c) Unit co Plan B (d) Gross Plan A for each of the two plans? (Round to two decimals.) (d) Which plan should be accepted? (Hint: Compute the gross profit under each plan.) Plan B