Diltex Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: Sales are budgeted at $270,000 for November, $250,000 for December, and $260,000 for January. Collections are expected to be 64% in the month of sale, 33% in the month following the sale, and 3% uncollectible. The cost of goods sold is 70% of sales. The company desires to have an ending merchandise inventory at the end of each month equal to 50% 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 $25,000. Monthly depreciation is $16,000. Ignore taxes.

Statement of Financial Position October 31
Assets
Cash	$21,000
Accounts receivable (net of allowance for uncollectible accounts)	78,000
Merchandise inventory	94,500
Property, plant and equipment (net of $541,000 accumulated depreciation)	961,000
Total assets	$1,154,500

Liabilities and Stockholder' Equity
Accounts payable	$129,000
Common stock	890,000
Retained earnings	135,500
Total liabilities and stockholder' equity	$1,154,500

The cost of December merchandise purchases would be:

$91,000 $178,500 $182,000 $175,000