question archive Sandhill Farm Supply Company manufactures and sells a pesticide called Snare
Sandhill Farm Supply Company manufactures and sells a pesticide called Snare
Subject:BusinessPrice: Bought3
Sandhill 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 Sales: quarter 1, 28,000 bags: quarter 2,43,000 bags. Selling price is $61 per bag, Direct materials: each bag of Snare requires 5 pounds of Gumm at a cost of $4 per pound and 6 pounds of Tarrat $1.8 per pound. Desired inventory levels: 3, January 1 April 1 July 1 8.100 12,400 Type of Inventory Snare (bags Gumm (pounds) Taer (pounds) 18,400 9.200 10,400 13,500 14,400 20,300 25,300 4 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. 5 6 Interest expense is $100,000 Gumm pounds 7.ZUU 10,400 13,500 Tarr (pounds) 14,400 20,300 25,300 5 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. 6 7 Your assistant has prepared two budgets: (1) the manufacturing overhead budget shows expected costs to be 125% of direct labor cost, and (2) the direct materials budget for Tarr shows the cost of Tarr purchases to be $302.000 in quarter 1 and $427,500 in quarter 2 (Note: Do not prepare the manufacturing overhead budget or the direct materials budget for Tarr.) Your answer is correct Prepare the sales budget. SANDHILL FARM SUPPLY COMPANY Sales Budget For the Six Months Ending June 30, 2022 Quarter Six Months 1 2 Expected Unit Sales 28,000 43,000 71.000 Unit Selling Price 61 $ 81 61 Total Sales 1.708.000 $ 2.623.000 $ 4,331,000 SANDHILL FARM SUPPLY COMPANY Production Budget For the Six Months Ending June 30, 2022 Quarter 1 2 28,000 43,000 Expected Unit Sales 12,400 18,400 Desired Ending Finished Goods Units Add : 40.400 61,400 Total Required Units 03.100 - 12,400 i Less: Beginning Finished Goods Units 32,300 49,000 Required Production Units Prepare the direct materials budget. (Round Cost per pound answers to 2 decimal places, e.g. 52.70.) SANDHILL FARM SUPPLY COMPANY Direct Materials Budget-Gumm For the Six Months Ending June 30, 2022 Quarter 1 2 < $ Type here to search Prepare the direct labor budget. (Enter Direct labor time per unit in proportion to hours, eg, for 45 minutes the proportion will be 0.75.) SANDHILL FARM SUPPLY COMPANY Direct Labor Budget Quarter Six Months 1 2 $ $ $ Prepare the selling and administrative expense budget. SANDHILL FARM SUPPLY COMPANY Prepare the selling and administrative expense budget. SANDHILL FARM SUPPLY COMPANY Selling and Administrative Expense Budget Quarter Six Months 1 2 $ $ $ $ I $ s $ $ c $ $ $ eTextbook and Media
