Diny Farm Supply is located in a small town in the rural west Data regarding the store operations foliow. Sales are budgeted at $296.000 for November $316,000 for December, and $230,000 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 $21700. Monthly depreciation is $24,000 Ignore taxes Balance Sheet October 31 Assets Cash Accounts receivable Merchandise inventory Property, plant and equipment net of 5624000 accumulated depreciation Total assets 28.000 80,000 165,760 110.000 1263.760 $ 5 Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total abilities and stockholders equity 242.000 746,000 295.760 1280760 $ The cost of December merchandise purchases would be: Multiple Choice O $204,640 O $252,800 O $236,800 O $198,600