Question 3: (22 marks total) mer Company processes 40,000 pounds of direct materials to produce two products, Apples and Apple Sauce. Apple Sauce, a byproduct, sells for $9 per pound, and Apples, the main product, sells for $50 per pound. The following information is for July: Beginning Ending Inventory Inventory 0 700 300 900 Production Sales 8,700 8,000 25,500 24,900 Apple Sauce Apples The manufacturing costs totaled $260,000; beginning inventory $3,200. Required a. Prepare a July income statement assuming that Farmer Company recognizes the byproduct revenue at the time of sale. The company uses FIFO for the inventory flow assumption b. Prepare the journal entry to record the byproduct sales