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. Sales: quarter 1, 28,400 bags: quarter 2,44,000 bags. Selling price is $62 per bag, Direct materials: each bag of Snare requires 4 pounds of Gumm at a cost of $3.80 per pound and 6 pounds of Tarrat $1.50 per pound 3. Desired inventory levels: 1. 2. Type of Inventory Snare (bags) Gumm (pounds) Tarr (pounds) January 1 8.100 9,100 14,300 April 1 12,500 10,400 20,200 July 1 18,300 13,100 25,400 5. 6. 7. 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 $ 180,000 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 Tore shows the cost of Tarr purchases to be $301,000 in quarter 1 and $427.500 in quarter 2 (Note: Do not prepare the manufacturing overhead budget or the direct materials budget for Tarr) Prepare the sales budget. COOK FARM SUPPLY COMPANY Sales Budget For the Six Months Ending June 30, 2020 Quarter 2 Six Months Expected Unit Sales 28,400 44000 72400 Unit Selling Price $ 62 $ 62 $ 62 Total Sales $ 1760800 $ 2728000 $ 4488800 Prepare the production budget. Prepare the production budget. COOK FARM SUPPLY COMPANY Production Budget For the Six Months Ending June 30, 2020 Quarter 2 Expected Unit Sales 28,400 44,000 Add : Desired Ending Finished Goods Units 125.000 18.300 Total Required Units 40.900 62.300 12.500 Less 8.100 Beginning Finished Goods Units 32,800 49,800 Required Production Units e Textbook and Media COOK FARM SUPPLY COMPANY Direct Materials Budget-Gumm For the Six Months Ending June 30, 2020 Quarter Six Months 1 2 32,800 49,800 4 duction 131.200 199,200 ig Direct Materials (Pounds) 14300 13.100 145,500 212,300 ect Materials (Pounds) 9,100 14.300 136,400 198,000 $ 3.8 $ 38 518 320 $ $ 752.400 $ 1.584,600 Is Purchases Prepare the direct labor budget. (Enter Direct labor time per unit in proportion to hours, es for 45 minutes the proportion will be 7501 MacBook Air OOO 20 FS = Prepare the direct labor budget. (Enter Direct labor time per unit in proportion to hours, eg. for 45 minutes the proportion will be 0.75.) COOK FARM SUPPLY COMPANY Direct Labor Budget For the Six Months Ending June 30, 2020 Quarter Six Months 2 ts to be Produced 32,800 49,800 ect Labor Time Hours) per Unit 0.25 0.25 al Required Direct Labor Hours 8.200 12.450 $ 14 $ ect Labor Cost per Hour $ $ 174,300 24 114,800 al Direct Labor Cost Prepare the selling and administrative expense budget. CUDDLY COMRANY Tipare som U13 UVECAME wust COOK FARM SUPPLY COMPANY Selling and Administrative Expense Budget For the Six Months Ending June 30, 2020 Quarter 1 2 Six Months 1.760,800 $ 2.728,000 $ 4.488,800 264,120 expenses $ 409.200 $ 673,320 enses 180,000 180,000 180,000 444.120 $ 589,200 $ 853,320 ng and Administrative Expenses e Textbook and Media Prepare the budgeted multiple-step income statement for the first 6 months. (Round intermediate calculations to 2 decimal places and final answer to O decimal places, es. 1,255.) COOK FARM SUPPLY COMPANY Budgeted Income Statement For the Six Months Ending June 30, 2020 Sales 4,488,800 Cost of Goods Sold 2,322,230 Gross Profit 2,166,570 853320 Selling and Administrative Expenses 1,313 250 Income from Operations 100,000 i Interest Expense 1.213.250 Income from Operations 363.975 Income Tax Expense $ 949.275 Net Income /(Loss)