danner farm supply company manufactures and sells a pesticide called snare the fol 384405

Danner 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 2009. Prepare budgeted income statement and supporting budgets. (SO 3, 4) 1. Sales: Quarter 1, 28,000 bags; quarter 2, 42,000 bags. Selling price is $60 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 $1.50 per pound. 3. Desired inventory levels: Type of Inventory January 1 April 1 July 1 Snare (bags) 8,000 12,000 18,000 Gumm (pounds) 9,000 10,000 13,000 Tarr (pounds) 14,000 20,000 25,000 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 $175,000 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 $297,000 in quarter 1 and $439,500 in quarter 2. Instructions Prepare the budgeted income statement for the first 6 months and all required operating budgets by quarters. (Note: Use variable and fixed in the selling and administrative expense budget). Do not prepare the manufacturing overhead budget or the direct materials budget for Tarr. part I need help on DANNER FARM SUPPLY COMPANY Budgeted Income Statement Sales 1,680,000 Cost of goods sold (70,000 X $33.75)* 448,000 Gross profit 1,232,000 Selling and administrative expenses 147,000 Income from operations 1,085,000 Income tax expense (30%) 215,600 Net income 869,400 *Cost Per Bag Cost Element Quantity Unit Cost Total Direct materials 2 Gumm?? 4 pounds Tarr?? 6 pounds Direct labor 1/4 hour Manufacturing Overhead (150% of Direct Labor) Total $0.00