Pharoah 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 2022. 1. 2. 3. Type of Inventory January 1 Snare (bags) Gumm (pounds) Tarr (pounds) 4. 5. 6. Sales: quarter 1, 28,600 bags; quarter 2, 42,600 bags. Selling price is $62 per bag. Direct materials: each bag of Snare requires 4 pounds of Gumm at a cost of $4 per pound and 6 pounds of Tarr at $1.5 per pound. Desired inventory levels: 7. 8,100 April 1 12,400 July 1 14,300 20,300 18,500 9,100 10,300 13,200 25,500 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 $177,000 per quarter. Interest expense is $100,000. Income taxes are expected to be 20% of income before income taxes.

Pharoah 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 2022. 1. Sales: quarter 1,28,600 bags; quarter 2,42,600 bags. Selling price is $62 per bag. 2. Direct materials: each bag of Snare requires 4 pounds of Gumm at a cost of $4 per pound and 6 pounds of Tarr at $1.5 per pound. 3. Desired inventory levels: 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 $177,000 per quarter. 6. Interest expense is $100,000. 7. Income taxes are expected to be 20% of income before income taxes. Pharoah 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 2022. 1. Sales: quarter 1,28,600 bags; quarter 2,42,600 bags. Selling price is $62 per bag. 2. Direct materials: each bag of Snare requires 4 pounds of Gumm at a cost of $4 per pound and 6 pounds of Tarr at $1.5 per pound. 3. Desired inventory levels: 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 $177,000 per quarter. 6. Interest expense is $100,000. 7. Income taxes are expected to be 20% of income before income taxes