Cook Farm Supply Company manufactures and sells a pesticide called Snare. The following data are available for preparing bus for Snare for the first 2 quarters of 2022. 1. 2. Sales: quarter 1,40,000 bags:quarter 2,56,000 bags. Selling price is $60 per bag. Direct materials: each bag of Snare requires 4 pounds of Gumm at a cost of $3.8 per pound and 6 pounds of Tarrat $1.9 pound Desired inventory levels: 3. January 1 April 1 July 1 8,000 15,000 18,000 Type of Inventory Snare (bags) Gumm (pounds) Tarr (pounds) 9,000 10,000 13,000 14,000 20,000 25,000 Direct labor: direct labor time is 15 minutes per bag at an hourly rate of $16 per hour. 5. 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 $175,000 per quarter Interest expense is $100.000, Income taxes are expected to be 20% of income before income taxes. 6. 7. 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 $297,000 in quarter 1 and 5439,500 in quarter 2 (Note: Do not prepare the manufacturing overhead budget or the direct materials budget for Tarr.)