Problem 24-03A a-b, cl, d (Video) Hill Industries had sales in 2019 of $7,120,000 and gross profit of $1,121,000. Management is considering two alternative budget plans to increase its gross profit in 2020. Plan A would increase the selling price per unit from $8.00 to $8.40. Sales volume would decrease by 10% from its 2019 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 2019, Hill has 48,000 units of inventory on hand. If Plan A is accepted, the 2020 ending inventory should be equal to 5% of the 2020 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 2020 should be $1,110,270 Your answer is partially correct. Try again. Prepare a sales budget for 2020 under each plan. (Round Unit selling price answers to 2 decimal places,e.g.52.70.) HILL INDUSTRIES Sales Budget December 31, 2020 Plan A Plan B Unit Selling Price 8.4 7.5 [ 801000 1010000 Unit Selling Price 6728400 7575000 Total Sales Your answer is partially correct. Try again. Prepare a production budget for 2020 under each plan. HILL INDUSTRIES Production Budget December 31, 2020 Plan A Plan B Required Production Units 1427490 1841400 Direct Materials per Unit 1110270 1432200 Add Direct Materials Purchases 951660 1227600 Desired Ending Direct Materials Add 1110270 1110270 4599690 5611470 Total Materials Required Your answer is correct. Compute the production cost per unit under each plan. (Round answers to 2 decimal places, Plan A Plan B Production cost per unit 5.485308 5.8 SHOW SOLUTION SHOW ANSWER LINK TO TEXT Your answer is partially correct. Try again Compute the gross profit under each plan. Plan A Plan B Gross Profit -11062.8 91251