Wahlen Farm Supply Company manufactures and sells a pesticide called Basic II. The following data are available for preparing budgets for Basic II for the first two quarters of 2022. 1. Sales: Quarter 1 - 40,000 bags; Quarter 2 - 60,000 bags. Selling price is $60 per bag. 2. Direct materials: Each bag of Basic II requires 6 kg of Crup at $4 per kilogram and 10 kg of Dert at $1.50 per kilogram. 3. Desired inventory levels: Type of Inventory Basic II (bags) January 1 10,000 April 1 July 1 15,000 20,000 Crup (kilograms) 9,000 12,000 15,000 Dert (kilograms) 15,000 20,000 25,000 4. Direct labour: Direct labour time is 15 minutes per bag at an hourly rate of $12 per hour. 5. Selling and administrative expenses are expected to be 10% of sales plus $150,000 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, which shows expected costs to be 100% of direct labour costs; (2) the direct materials budget for Dert, which shows the cost of Dert purchases to be $682,500 in quarter 1 and $982,500 in quarter 2. Required Prepare the budgeted income statement for the first six months of 2022 and all required supporting budgets by quarter and in total for the first six months of 2022. (Note: Categorize variable and fixed items in the selling and administrative expenses budget.) Do not prepare the manufacturing overhead budget or the direct materials budget for Dert. 58 marks