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 2020.

1.		Sales: quarter 1, 28,600 bags; quarter 2, 42,600 bags. Selling price is $63 per bag.
2.		Direct materials: each bag of Snare requires 5 pounds of Gumm at a cost of $3.80 per pound and 6 pounds of Tarr at $1.75 per pound.
3.		Desired inventory levels:

Type of Inventory		January 1		April 1		July 1
Snare (bags)		8,200		12,100		18,500
Gumm (pounds)		9,400		10,300		13,400
Tarr (pounds)		14,500		20,100		25,500

4.		Direct labor: direct labor time is 15 minutes per bag at an hourly rate of $16 per hour.
5.		Selling and administrative expenses are expected to be 15% of sales plus $176,000 per quarter.
6.		Interest expense is $100,000.
7.		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 $422,500 in quarter 2. (Note: Do not prepare the manufacturing overhead budget or the direct materials budget for Tarr.)

(a)

Prepare the sales budget.

COOK FARM SUPPLY COMPANY Sales Budget For the Six Months Ending June 30, 2020June 30, 2020For the Quarter Ending June 30, 2020
		Quarter				Six Months
		1		2
Direct LaborDirect MaterialsExpected Unit SalesProduction UnitsTotal SalesUnit Selling Price
Direct LaborDirect MaterialsExpected Unit SalesProduction UnitsTotal SalesUnit Selling Price		$		$		$
Direct LaborDirect MaterialsExpected Unit SalesProduction UnitsTotal SalesUnit Selling Price		$		$		$

Prepare the production budget.

COOK FARM SUPPLY COMPANY Production Budget June 30, 2020For the Quarter Ending June 30, 2020For the Six Months Ending June 30, 2020
		Quarter				Six Months
		1		2
Beginning Direct MaterialsTotal Direct Labor CostTotal Required Direct Labor HoursTotal Required UnitsDirect Materials PurchasesDirect Labor Time per UnitDirect Materials per UnitTotal Cost of Direct Materials PurchasesDesired Ending Finished Goods UnitsTotal Materials RequiredDirect Labor Cost per HourBeginning Finished Goods UnitsCost per PoundExpected Unit SalesTotal Pounds Needed for ProductionDesired Ending Direct MaterialsRequired Production Units
AddLess: Direct Labor Time per UnitBeginning Finished Goods UnitsTotal Required UnitsDesired Ending Direct MaterialsTotal Cost of Direct Materials PurchasesTotal Materials RequiredBeginning Direct MaterialsTotal Direct Labor CostTotal Pounds Needed for ProductionDirect Materials PurchasesDirect Materials per UnitRequired Production UnitsDesired Ending Finished Goods UnitsExpected Unit SalesTotal Required Direct Labor HoursDirect Labor Cost per HourCost per Pound
Total Cost of Direct Materials PurchasesBeginning Direct MaterialsBeginning Finished Goods UnitsCost per PoundTotal Direct Labor CostDirect Materials per UnitDirect Labor Time per UnitTotal Required UnitsTotal Pounds Needed for ProductionDesired Ending Finished Goods UnitsRequired Production UnitsTotal Materials RequiredDirect Materials PurchasesExpected Unit SalesDesired Ending Direct MaterialsTotal Required Direct Labor HoursDirect Labor Cost per Hour
AddLess: Desired Ending Direct MaterialsTotal Required UnitsDirect Labor Cost per HourBeginning Direct MaterialsRequired Production UnitsTotal Materials RequiredTotal Direct Labor CostTotal Required Direct Labor HoursExpected Unit SalesDesired Ending Finished Goods UnitsCost per PoundTotal Pounds Needed for ProductionDirect Materials per UnitBeginning Finished Goods UnitsTotal Cost of Direct Materials PurchasesDirect Labor Time per UnitDirect Materials Purchases
Total Materials RequiredTotal Required Direct Labor HoursTotal Pounds Needed for ProductionDirect Materials PurchasesTotal Cost of Direct Materials PurchasesExpected Unit SalesDirect Labor Cost per HourBeginning Finished Goods UnitsDirect Labor Time per UnitTotal Direct Labor CostTotal Required UnitsDesired Ending Direct MaterialsCost per PoundDesired Ending Finished Goods UnitsDirect Materials per UnitBeginning Direct MaterialsRequired Production Units