Concord Industries had sales in 2024 of $5,657,600 and gross profit of $915,200. Management is considering two alternative budget plans to increase its gross profit in 2025. Plan A would increase the unit selling price from $8.00 to $8.40. Sales volume would decrease by 104,000 units from its 2024 level. Plan B would decrease the unit selling price by $0.5. The marketing department expects that the sales volume would increase by 108,160 units. At the end of 2024, Concord has 33,280 units of inventory on hand. If Plan A is accepted, the 2025 ending inventory should be 29,120 units. If Plan B is accepted, the ending inventory should be equal to 49,920 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 2025 should be $1,576,640. Prepare a sales budget for 2025 under each plan. (Round Unit selling price answers to 2 decimal places, e.g. 52.70.) + + $ $ CONCORD INDUSTRIES Sales Budget Plan A $ $ Plan B
Concord Industries had sales in 2024 of $5,657,600 and gross profit of $915,200. Management is considering two alternative budget plans to increase its gross profit in 2025. Plan A would increase the unit selling price from $8.00 to $8.40. Sales volume would decrease by 104,000 units from its 2024 level. Plan B would decrease the unit selling price by $0.5. The marketing department expects that the sales volume would increase by 108,160 units. At the end of 2024, Concord has 33,280 units of inventory on hand. If Plan A is accepted, the 2025 ending inventory should be 29,120 units. If Plan B is accepted, the ending inventory should be equal to 49,920 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 2025 should be $1,576,640. Prepare a sales budget for 2025 under each plan. (Round Unit selling price answers to 2 decimal places, e.g. 52.70.) + + $ $ CONCORD INDUSTRIES Sales Budget Plan A $ $ Plan B
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
Dd.6.
Transcribed Image Text:Prepare a production budget for 2025 under each plan.
O
Production cost per unit $
Compute the production cost per unit under each plan. (Round answers to 2 decimal places, e.g. 1.25.)
Gross Profit
Plan A
Which plan should be accepted?
CONCORD INDUSTRIES
Production Budget
Plan A
should be accepted.
Compute the gross profit under each plan. (Round answers to 0 decimal places, e.g. 125.)
Plan A
$
Plan B
Plan B
Plan E
Transcribed Image Text:Concord Industries had sales in 2024 of $5,657,600 and gross profit of $915,200. Management is considering two
alternative budget plans to increase its gross profit in 2025.
Plan A would increase the unit selling price from $8.00 to $8.40. Sales volume would decrease by 104,000 units from
its 2024 level. Plan B would decrease the unit selling price by $0.5. The marketing department expects that the sales
volume would increase by 108,160 units.
At the end of 2024, Concord has 33,280 units of inventory on hand. If Plan A is accepted, the 2025 ending inventory
should be 29,120 units. If Plan B is accepted, the ending inventory should be equal to 49,920 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 2025
should be $1,576,640.
Prepare a sales budget for 2025 under each plan. (Round Unit selling price answers to 2 decimal places,
e.g. 52.70.)
$
$
CONCORD INDUSTRIES
Sales Budget
Plan A
$
$
Plan B
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