Diltex Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow: Sales are budgeted at $220,000 for November, $200,000 for December, and $210,000 for January. . Collections are expected to be 70% in the month of sale, 27% in the month following the sale, and 3% uncollectible. The cost of goods sold is 65% 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 $22,500. Monthly depreciation is $19,000. Ignore taxes. Statement of Financial Position October 31 Assets Cash. Accounts receivable (net of allowance for uncollectible accounts). Merchandise inventory Property, plant and equipment (net or $536,000 accumulated depreciation). Total assets $ 16,000 76,000 71,500 956,000 $1,119,500 Liabilities and Stockholders' Equity Accounts payable Common stock.. Retained earnings.. Total liabilities and stockholders' equity $ 147,000 840,000 132.500 $1,119,500 The cost of December merchandise purchases would be: Select one: a. $133,250 O b. $68,250 c. $130,000 O d. $143,000