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Wildhorse Farm Supply Company manufactures and sells a pesticide called Snare. The following data are...

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Accounting

Wildhorse 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.
Sales: quarter 1,28,600 bags; quarter 2,42,800 bags. Selling price is $63 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 $1.5 per pound.
Desired inventory levels:
\table[[Type of Inventory,January 1,,April 1,July 1],[Snare (bags),8,100,12,100,18,200,],[Gumm (pounds),9,300,10,300,13,400,],[Tarr (pounds),14,300,20,400,25,200,]]
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 $177,000 per quarter.
Interest expense is $100,000.
Income taxes are expected to be 20% of income before income taxes.
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