-75 Question 2 of 2 View Policies Current Attempt in Progress Ivanhoe Farm Supply Company manufactures and sells a pesticide called Snare. The following data are available for preparing budgets for Snore for the first 2 quarters of 2020. 1 Sales: quarter 1.28,400 bags quarter 2,42200 bars Selling price is $62 per bag Direct materials: each bag of Snare requires Spounds of Gummat a cost of $3.80 per pound and pounds of Tarr at $1.50 per pound 3 Desired inventory levels January 1 April 1 July 1 8.500 12,300 18,100 Type of Inventory Snare (bas) Gume (pounds) Tore (pounds 9,300 10.300 13,100 14 300 20.500 25.100 5. Direct labor direct labor time is 15 minutes per bag at an hourly rate of $16 per hour. Selling and administrative expenses are expected to be 15% of sales plus $176,000 per quarter. Interest expense is $100.000 Income taxes are expected to be 30% of income before income taxes 6 7 Your assistant has prepared two budgets: (1) the manufacturing overhead budget shows cpected costs to be 125% of direct labor colland (2) the direct materiais budget for Tarr shows the cost of Tarr purchases to be $299,000 in quarter 1 and 5427.500 in quarter 2 (Note: Do not prepare the manufacturing overhead budget or the direct materials budget for Tare)