Sunland Industries had sales in 2021 of $ 6,392,000 and gross profit of $ 1,034,000. Management is considering two alternative budget 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 117,500 units from its 2021 level. Plan B would decrease the selling price per unit by $ 0.50. The marketing department expects that the sales volume would increase by 122,200 units. At the end of 2021, Sunland has 39,000 units of inventory on hand. If Plan A is accepted, the 2022 ending inventory should be 35,000 units. If Plan B is accepted, the ending inventory should be equal to 62,000 units. Each unit produced will cost $ 1.50 in direct labor, $ 1.30 in direct materials, and $ 1.20 in variable overhead. The fixed overhead for 2022 should be $ 1,782,000.

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 For the Year Ending December 31, 2022For the Quarter Ending December 31, 2022December 31, 2022
		Plan A		Plan B
select an opening sales budget item		enter a number of units		enter a number of units
select a sales budget item		$ enter a dollar amount		$ enter a dollar amount
select a closing sales budget item		$ enter a total dollar amount		$ enter a total dollar amount

Prepare a production budget for 2022 under each plan.

SUNLAND INDUSTRIES Production Budget choose the accounting period December 31, 2022For the Year Ending December 31, 2022For the Quarter Ending December 31, 2022
		Plan A		Plan B
select an opening production budget item		enter a number of units		enter a number of units
select between addition and deduction AddLess: select a production budget item		enter a number of units		enter a number of units
select a summarizing line for the first part		enter a total number of units for the first part		enter a total number of units for the first part
select between addition and deduction AddLess:		enter a number of units		enter a number of units
select a closing production budget item		enter a total number of units		enter a total number of units

Compute the production cost per unit under each plan. (Round answers to 2 decimal places, e.g. 1.25.)

		Plan A		Plan B
Production cost per unit		$ enter production cost per unit in dollars		$ enter production cost per unit in dollars

Compute the gross profit under each plan.

		Plan A		Plan B
Gross Profit		$ enter gross profit in dollars		$ enter gross profit in dollars

Which plan should be accepted?

select a plan