Ivanhoe 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 2025. 1. 2. 3. Type of Inventory January 1 Snare (bags) Gumm (pounds) Tarr (pounds) 4. 5. 6. Sales: quarter 1, 29,400 bags; quarter 2, 42,200 bags. Selling price is $62 per bag. Direct materials: each bag of Snare requires 5 pounds of Gumm at a cost of $4 per pound and 6 pounds of Tarr at $1.50 per pound. Desired inventory levels: 7. April 1 8,100 12,200 9,300 10,100 14,100 20,200 July 1 18,500 13,100 25,200 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 $179,000 per quarter. Interest expense is $100,000 for the 2 quarters. Income taxes are expected to be 20% 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 $301,000 in quarter 1 and $424,500 in quarter 2. (Note: Do not prepare the manufacturing overhead budget or the direct materials budget for Tarr.)

Ivantice Farm Supply Company manutactures and sells a pesticlde called Snare. The following data are avallable for reparing budgets for Snave for the first 2 quarters of 2025. 1. Soles quarter 1,29,400 bags: quarter 2,42,200 bagk. Selling price is 562 per bag 2. Direct materials: each bag of 5 nare requires 5 pounds of Gumm at a cost of 54 per pound and 6 pounds of Tarr at $150 per pound. 3. Desired imentory levels 4. Direct labori direct bbor time is 15 mimutes per bag at an hourly rate of $16 per hour. 5. Seline and administrative expenses are expected to be 15% of sales plus $179,000 per quarter 6. Interest expense is $100000 for the 2 quarters. 7. Income taves are expected to be 20N of income before incocne taxes. Your assatant has prepared two budgets. (1) the manufacturing overhead budget shows expected costs to be 125% of direct iabor 2. (Wote. Do not prepare the manufacturingoverhead budcet or the direct materlals budeet for Tarr.)