Glendo 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 2014.

1.	Sales: Quarter 1, 28,800 bags; quarter 2, 43,400 bags. Selling price is $62 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 $1.50 per pound.
3.	Desired inventory levels:

Type of Inventory	January 1	April 1	July 1
Snare (bags)	8,200	12,300	18,200
Gumm (pounds)	9,300	10,300	13,500
Tarr (pounds)	14,400	20,200	25,500

4.	Direct labor: direct labor time is 15 minutes per bag at an hourly rate of $14 per hour.
5.	Selling and administrative expenses are expected to be 15% of sales plus $178,000 per quarter.
6.	Income taxes are expected to be 30% of income from operations.

Your assistant has prepared two budgets: (1) The manufacturing overhead budget shows expected costs to be 150% of direct labor cost. (2) The direct materials budget for Tarr shows the cost of Tarr purchases to be $299,000 in quarter 1 and $424,000 in quarter 2.

(A) Prepare the production budget.

(B) Prepare Direct Materials Budget-Gumm.

(C) Prepare Direct Labor Budget.

(D) Prepare Selling and Administrative Expense Budget.

(E) Prepare the Budgeted Income Statement.

Glendo 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 2014. 1. Sales: Quarter 1, 28,800 bags; quarter 2, 43,400 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 Tarr 2. at $1.50 per pound. 3. Desired inventory levels: April 1 8,200 12,300 9,300 10,300 14,400 20,200 Type of Inventory January 1 July 1 Snare (bags) Gumm (pounds) Tarr (pounds) 18,200 13,500 25,500 4. Direct labor: direct labor time is 15 minutes per bag at an hourly rate of $14 per hour. 5. Selling and administrative expenses are expected to be 15% of sales plus $178,000 per quarter. 6. Income taxes are expected to be 30% of income from operations. Your assistant has prepared two budgets: (1) The manufacturing overhead budget shows expected costs to be 150% of direct labor cost. (2) The direct materials budget for Tarr shows the cost of Tarr purchases to be $299,000 in quarter 1 and $424,000 in quarter 2. (A) Prepare the production budget. GLENDO FARM SUPPLY COMPANY Sales Budget For the Six Months Ending June 30, 2014 Quarter Six 1 2 Months Expected unit 28,800 43,400 72200 sales $ $ $ Unit selling price 62 62 62 $ Total sales $ 1785600 $ 2690800 4476400 Prepare the production budget. GLENDO FARM SUPPLY COMPANY Production Budget For the Six Months Ending June 30, 2014 Quarter 1 Expected Unit Sales : Add Desired Ending Finished Goods Units Total Required Units : Less Beginning Finished Goods Units Required Production Units (B) Prepare Direct Materials BudgetGumm. 28,800 2 43,400 Six Months 1 (C) Prepare Direct Labor Budget. (D) Prepare Selling and Administrative Expense Budget. (E) Prepare the Budgeted Income Statement.