Dilly Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow:

• Sales are budgeted at $297,000 for November, $317,000 for December, and $217,000 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 $21,800.
• Monthly depreciation is $24,500.
• Ignore taxes.

Balance Sheet

October 31AssetsCash$28,500Accounts receivable80,500Merchandise inventory178,200Property, plant and equipment, net of $624,000 accumulated depreciation1,011,000Total assets$1,298,200Liabilities and Stockholders' EquityAccounts payable$243,000Common stock747,000Retained earnings308,200Total liabilities and stockholders' equity$1,298,200

Retained earnings at the end of December would be:

Garrison 16e Rechecks 2017-10-03, 2017-10-31

Multiple Choice

• $308,200
• $354,400
• $346,300
• $369,100