Sandhill Industries had sales in 2021 of $8,160,000 and gross profit of $1,320,000. Management is considering two altern
Posted: Sun Jul 03, 2022 3:56 pm
Sandhill Industries had sales in 2021 of$8,160,000 and gross profit of $1,320,000. Management isconsidering two alternative budget plans to increase its grossprofit in 2022.Plan A would increase the selling price per unit from $8.00 to$8.40. Sales volume would decrease by 150,000 units fromits 2021 level. Plan B would decrease the selling price per unit by$0.50. The marketing department expects that the sales volume wouldincrease by 156,000 units.At the end of 2021, Sandhill has 52,000 unitsof inventory on hand. If Plan A is accepted, the 2022 endinginventory should be 48,000 units. If Plan B is accepted,the ending inventory should be equal to 88,000 units.Each unit produced will cost $1.50 in direct labor,$1.30 in direct materials, and $1.20 in variableoverhead. The fixed overhead for 2022 should be $2,276,000.
(a)
Prepare a sales budget for 2022 under eachplan. (Round Unit selling price answers to 2decimal places, e.g. 52.70.)
SANDHILL INDUSTRIESSales Budgetchoose 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 Direct LaborDirectMaterialsExpected Unit SalesProduction UnitsTotal SalesUnit SellingPrice
enter a number of units
enter a number of units
select a sales budget item Direct LaborDirectMaterialsExpected Unit SalesProduction UnitsTotal SalesUnit SellingPrice
select a closing sales budget item Direct LaborDirectMaterialsExpected Unit SalesProduction UnitsTotal SalesUnit SellingPrice
(b)
Prepare a production budget for 2022 under each plan.
SANDHILL INDUSTRIESProduction Budgetchoose 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 production budget item Beginning FinishedGoods UnitsRequired Production UnitsTotal Required UnitsTotalMaterials RequiredExpected Unit SalesBeginning DirectMaterialsDirect Materials per UnitDesired Ending DirectMaterialsTotal Pounds Needed for ProductionDesired Ending FinishedGoods UnitsDirect Materials Purchases
enter a number of units
enter a number of units
select between addition and deduction AddLess: select a productionbudget item Desired Ending Finished GoodsUnitsBeginning Finished Goods UnitsTotal Pounds Needed forProductionBeginning Direct MaterialsExpected Unit SalesTotalRequired UnitsRequired Production UnitsDirect MaterialsPurchasesDirect Materials per UnitDesired Ending DirectMaterialsTotal Materials Required
select a summarizing line for the first part Direct Materials perUnitDirect Materials PurchasesTotal Required UnitsTotal MaterialsRequiredExpected Unit SalesTotal Pounds Needed forProductionBeginning Finished Goods UnitsRequired ProductionUnitsDesired Ending Direct MaterialsBeginning DirectMaterialsDesired Ending Finished Goods Units
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: select a productionbudget item Direct Materials per UnitTotalRequired UnitsDesired Ending Direct MaterialsDirect MaterialsPurchasesRequired Production UnitsDesired Ending Finished GoodsUnitsTotal Materials RequiredExpected Unit SalesBeginning FinishedGoods UnitsBeginning Direct MaterialsTotal Pounds Needed forProduction
select a closing production budget item Direct Materials per UnitBeginningFinished Goods UnitsTotal Materials RequiredBeginning DirectMaterialsRequired Production UnitsTotal Pounds Needed forProductionTotal Required UnitsDirect Materials PurchasesDesiredEnding Finished Goods UnitsExpected Unit SalesDesired Ending DirectMaterials
(a)
Prepare a sales budget for 2022 under eachplan. (Round Unit selling price answers to 2decimal places, e.g. 52.70.)
SANDHILL INDUSTRIESSales Budgetchoose 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 Direct LaborDirectMaterialsExpected Unit SalesProduction UnitsTotal SalesUnit SellingPrice
enter a number of units
enter a number of units
select a sales budget item Direct LaborDirectMaterialsExpected Unit SalesProduction UnitsTotal SalesUnit SellingPrice
select a closing sales budget item Direct LaborDirectMaterialsExpected Unit SalesProduction UnitsTotal SalesUnit SellingPrice
(b)
Prepare a production budget for 2022 under each plan.
SANDHILL INDUSTRIESProduction Budgetchoose 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 production budget item Beginning FinishedGoods UnitsRequired Production UnitsTotal Required UnitsTotalMaterials RequiredExpected Unit SalesBeginning DirectMaterialsDirect Materials per UnitDesired Ending DirectMaterialsTotal Pounds Needed for ProductionDesired Ending FinishedGoods UnitsDirect Materials Purchases
enter a number of units
enter a number of units
select between addition and deduction AddLess: select a productionbudget item Desired Ending Finished GoodsUnitsBeginning Finished Goods UnitsTotal Pounds Needed forProductionBeginning Direct MaterialsExpected Unit SalesTotalRequired UnitsRequired Production UnitsDirect MaterialsPurchasesDirect Materials per UnitDesired Ending DirectMaterialsTotal Materials Required
select a summarizing line for the first part Direct Materials perUnitDirect Materials PurchasesTotal Required UnitsTotal MaterialsRequiredExpected Unit SalesTotal Pounds Needed forProductionBeginning Finished Goods UnitsRequired ProductionUnitsDesired Ending Direct MaterialsBeginning DirectMaterialsDesired Ending Finished Goods Units
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: select a productionbudget item Direct Materials per UnitTotalRequired UnitsDesired Ending Direct MaterialsDirect MaterialsPurchasesRequired Production UnitsDesired Ending Finished GoodsUnitsTotal Materials RequiredExpected Unit SalesBeginning FinishedGoods UnitsBeginning Direct MaterialsTotal Pounds Needed forProduction
select a closing production budget item Direct Materials per UnitBeginningFinished Goods UnitsTotal Materials RequiredBeginning DirectMaterialsRequired Production UnitsTotal Pounds Needed forProductionTotal Required UnitsDirect Materials PurchasesDesiredEnding Finished Goods UnitsExpected Unit SalesDesired Ending DirectMaterials