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

• Sales are budgeted at $296,000 for November, $316,000 for December, and $216,000 for January.
• Collections are expected to be 65% in the month of sale and 35% in the month following the sale.
• The cost of goods sold is 80% of sales.
• The company desires to have an ending merchandise inventory at the end of each month equal to 70% 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 $21,700.
• Monthly depreciation is $24,000.
• Ignore taxes.

Balance Sheet
October 31
Assets
Cash	$ 28,000
Accounts receivable	80,000
Merchandise inventory	184,400
Property, plant and equipment, net of $624,000 accumulated depreciation	1,010,000
Total assets	$ 1,302,400
Liabilities and Stockholders' Equity
Accounts payable	$ 242,000
Common stock	746,000
Retained earnings	314,400
Total liabilities and stockholders' equity	$ 1,302,400

Expected cash collections in December are: