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. 2. Sales: quarter 1, 28,600 bags; quarter 2,42,600 bags. Selling price is $63 per bag. 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. Desired inventory levels: 3. January 1 April 1 July 1 Type of Inventory 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. 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.) COOK FARM SUPPLY COMPANY Direct Materials Budget-Gumm For the Six Months Ending June 30, 2020 Quarter 1 2 Units to be Produced 28,600 42,600 Direct Materials per Unit 5 5 Total Cost of Direct Materials Purchases 143,000 213,000 Add Desired Ending Direct Materials (Pounds) 10,300 13,400 Total Materials Required 153,300 220,400 Less Beginning Direct Materials (Pounds) 9400 i 10,300 i Direct Materials Purchases 143,900 216,100 Cost per Pound $ 3.8 $ 3.8 Total Cost of Direct Materials Purchases $ 546,820 $ 821,180 COOK FARM SUPPLY COMPANY Direct Labor Budget For the Six Months Ending June 30, 2020 Quarter 1 2 Mc Units to be produced 28,600 42,600 Direct Labor Time (Hours) per Unit 15 15 Total Required Direct Labor Hours 7,150 10,650 Direct Labor Cost per Hour $ 16 $ 16 Total Direct Labor Cost $ 114,400 $ 170,400 $ $