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 2017.

1.Sales: quarter 1,29,800bags; quarter 2,43,700bags. Selling price is $63per bag.

2.Direct materials: each bag of Snare requires4pounds of Gumm at a cost of $3.8per pound and6pounds of Tarr at $1.75per pound.

3.Desired inventory levels:

Type of Inventory January 1 April 1 July 1

Snare (bags) 8,200 12,100 18,500

Gumm (pounds) 9,500 10,100 13,200

Tarr (pounds) 14,100 20,300 25,200

4.Direct labor: direct labor time is 15 minutes per bag at an hourly rate of $14per hour.

5.Selling and administrative expenses are expected to be 15% of sales plus $180,000per 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 $298,000in quarter 1 and $423,500in quarter 2.

Please help me with the budgeted multiple-step income statement for the first 6 months.