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, 29,400 bags; quarter 2, 42,600 bags. Selling price is $63 per bag.
2.		Direct materials: each bag of Snare requires 4 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)		8,100		12,200		18,100
Gumm (pounds)		9,500		10,100		13,200
Tarr (pounds)		14,200		20,500		25,400

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 $179,000 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 $301,000 in quarter 1 and $426,500 in quarter 2. (Note: Do not prepare the manufacturing overhead budget or the direct materials budget for Tarr.)

(a) Your answer is correct Prepare the sales budget. COOK FARM SUPPLY COMPANY Sales Budget For the Six Months Ending June 30, 2020 Quarter Months Expected Unit Sales 29400T 42600 T 72000 Unit Selling Price 63.00 63.00 63.00 Total Sales J 1852200.00 2683800.00 4536000.00 Prepare the production budget. COOK FARM SUPPLY COMPANY Production Budget For the Six Months Ending June 30, 2020 Quarter Six Months Expected Unit Sales Add Desired Ending Finished Goods Units 00T 42600 18100 60700 Total Required Units 41600 Beginning Finished Goods Units 122001 48500 1 Required Production Units 82000 LINK TO TEXT LINK TO TEXT Attempts: 3 of 3 used (b) Prepare the direct materials budget. (Round Cost per pound answers to 2 decimal places, e.g. 52.70.) COOK FARM SUPPLY COMPANY Direct Materials Budget-Gumm Quarter Six 2 Months Prepare the direct labor budget. (Enter Direct labor time per unit in proportion to hours, e.g. for 45 minutes the proportion will be 0.75.) COOK FARM SUPPLY COMPANY Direct Labor Budget Quarter Six Months Prepare the selling and administrative expense budget COOK FARM SUPPLY COMPANY Selling and Administrative Expense Budget Quarter Six Months