1) Prepare the Direct Materials Budget

2)Prepare the Direct Labor Budget

3)Prepare the Selling and Administrative Budget

Cook Farm Supply Company manufactures and sells a pesticide called Snare. The following data are available for preparing budgets for Snare for the first 2 quarters of 2017 Sales: quarter 1, 29,800 bags; quarter 2, 42,400 bags. Selling price is $ 62 per bag. Direct materials: each bag of Snare requires 4 pounds of Gumm at a cost of $ 3.8 per pound and 6 pounds of Tarr at $1.50 per pound. Desired inventory levels: 1. 2. 3. Type of Inventory Snare (bags) Gumm (pounds) Tarr (pounds) January 1 April 1 8,300 12,400 18,100 9,300 10,500 13,300 14,300 20,400 25,400 July 1 4. 5. 6. 7. Direct labor: direct labor time is 15 minutes per bag at an hourly rate of $ 14 per hour. Selling and administrative expenses are expected to be 15% of sales plus $ 178,000 per quarter. Interest expense is $100,000. Income taxes are expected to be 30% of income before income taxes. Your assistant has prepared two budgets: (1) the manufacturing overhead budget shows expected costs to be 125% of direct labor cost, and (2) the direct materials budget for Tarr shows the cost of Tarr purchases to be $ 300,000 in quarter 1 and $426,500 in quarter 2