Sheffield Industries had sales in 2016 of $6,960,000and gross profit of $1,152,000. Management is considering two alternative budget plans to increase its gross profit in 2017.

Plan A would increase the selling price per unit from $8.00to $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 by104,000units.

At the end of 2016, Sheffield has45,000units 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 to72,000units. Each unit produced will cost $1.80in direct labor, $1.40in direct materials, and $1.20in variable overhead. The fixed overhead for 2017 should be $1,662,000.

(a)

display a sales budget for 2017 under each plan.(Round Unit selling price answers to 2 decimal places, e.g. 52.70.)

SHEFFIELDINDUSTRIES

Sales Budget

December 31, 2017

For the Year Ending December 31, 2017

For the Quarter Ending December 31, 2017

Plan A

Plan B

Expected unit sales

Unit selling price$

$

Total sales$

$