Hardy Companys cost of goods sold is consistently 70% of sales. The company plans ending merchandise inventory for each month equal to 20% of the next months budgeted cost of goods sold. All merchandise is purchased on credit, and 40% of the purchases made during a month is paid for in that month. Another 45% is paid for during the first month after purchase, and the remaining 15% is paid for during the second month after purchase. Expected sales are: August (actual), $335,000; September (actual), $350,000; October (estimated), $260,000; and November (estimated), $310,000. Use this information to determine Octobers expected cash payments for purchases.

Calculate Monthly Purchases: August September October November Budgeted ending inventory Cost of goods sold (estimated) Required available inventory 43,400 182,000 225,400 36,400 189,000 49,000 $ 36,400$ 245,000 281,400 49,000 $236,600 $ 232,400 234,500 283,500 46,900 217,000 udgeted beginning inventory Required purchases Calculate Payments Made for Inventory: Purchases September paid in Purchases August October After October 236,600s 232,400 189,000 94,640106,470 $ 35,490 $ August purchases September purchases October purchases 92,960 Determine October's Expected Cash Payments for Purchases October's expected cash payments for purchases