Sunland Industries had sales in 2021 of $5,535,200 and gross profit of $895,400. Management is considering two alternative budget plans to increase its gross profit in 2022. Plan A would increase the unit selling price from $8.00 to $8.40. Sales volume would decrease by 101,750 units from its 2021 level. Plan B would decrease the unit selling price by $0.50. The marketing department expects that the sales volume would increase by 105,820 units. At the end of 2021, Sunland has 32,560 units of inventory on hand. If Plan A is accepted, the 2022 ending inventory should be 28,490 units. If Plan B is accepted, the ending inventory should be equal to 48,840 units. Each unit produced will cost $1.5 in direct labor, $1.3 in direct materials, and $1.2 in variable overhead. The fixed overhead for 2022 should be $1,542,530.

(a)

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Prepare a sales budget for 2022 under each plan. (Round Unit selling price answers to 2 decimal places, e.g. 52.70.)

SUNLAND INDUSTRIES Sales Budget choose the accounting period December 31, 2022For the Quarter Ending December 31, 2022For the Year Ending December 31, 2022
		Plan A		Plan B
select a sales budget item Direct LaborDirect MaterialsExpected Unit SalesProduction UnitsTotal SalesUnit Selling Price		enter a number of units		enter a number of units
select a sales budget item Direct LaborDirect MaterialsExpected Unit SalesProduction UnitsTotal SalesUnit Selling Price		$enter a dollar amount rounded to 2 decimal places		$enter a dollar amount rounded to 2 decimal places
select a closing sales budget item Direct LaborDirect MaterialsExpected Unit SalesProduction UnitsTotal SalesUnit Selling Price		$enter a total dollar amount		$enter a total dollar amount

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(b)

Prepare a production budget for 2022 under each plan.

SUNLAND INDUSTRIES Production Budget choose the accounting period For the Quarter Ending December 31, 2022For the Year Ending December 31, 2022December 31, 2022
		Plan A		Plan B
select an opening production budget item Total Pounds Needed for ProductionDesired Ending Direct MaterialsDirect Materials PurchasesDesired Ending Finished Goods UnitsDirect Materials per UnitTotal Materials RequiredTotal Required UnitsBeginning Direct MaterialsExpected Unit SalesRequired Production UnitsBeginning Finished Goods Units		enter a number of units		enter a number of units
select between addition and deduction AddLess: select a production budget item Direct Materials per UnitBeginning Finished Goods UnitsDesired Ending Finished Goods UnitsTotal Materials RequiredDesired Ending Direct MaterialsTotal Pounds Needed for ProductionBeginning Direct MaterialsExpected Unit SalesTotal Required UnitsRequired Production UnitsDirect Materials Purchases		enter a number of units		enter a number of units
select a summarizing line for the first part Beginning Finished Goods UnitsExpected Unit SalesDirect Materials per UnitDirect Materials PurchasesTotal Materials RequiredDesired Ending Direct MaterialsTotal Pounds Needed for ProductionDesired Ending Finished Goods UnitsTotal Required UnitsRequired Production UnitsBeginning Direct Materials		enter a total amount for the first part		enter a total amount for the first part
select between addition and deduction AddLess: select a production budget item Direct Materials per UnitRequired Production UnitsTotal Materials RequiredDirect Materials PurchasesDesired Ending Direct MaterialsTotal Required UnitsBeginning Direct MaterialsDesired Ending Finished Goods UnitsBeginning Finished Goods UnitsExpected Unit SalesTotal Pounds Needed for Production		enter a number of units		enter a number of units
select a closing production budget item Direct Materials PurchasesExpected Unit SalesBeginning Direct MaterialsRequired Production UnitsTotal Required UnitsTotal Materials RequiredTotal Pounds Needed for ProductionBeginning Finished Goods UnitsDirect Materials per UnitDesired Ending Direct MaterialsDesired Ending Finished Goods Units		enter a total number of units		enter a total number of units

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