Dilly Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: Sales are budgeted at $300,000 for November, $320,000 for December, and $220,000 for January. Collections are expected to be 70% in the month of sale and 30% in the month following the sale. The cost of goods sold is 75% of sales. The company desires to have an ending merchandise inventory at the end of each month equal to 80% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase. Other monthly expenses to be paid in cash are $22,100. Monthly depreciation is $26,000. Ignore taxes. Assets Cash Accounts receivable Merchandise inventory Property, plant and equipment, net of $624,000 accumulated. depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity The cost of December merchandise purchases would be: Multiple Choice $180,000 Balance Sheet October 31 $225.000 $132,000 $240.000 $ 30,000 82,000 180,000 1,014,000. $1,306,000 $ 246,000 750,000 310,000 $1,306,000