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 35% is paid for during the first month after purchase, and the remaining 25% is paid for during the second month after purchase. Expected sales are: August (actual), $335,000; September (actual), $370,000; October (estimated), $330,000; and November (estimated), $380,000.

Use this information to determine Octobers expected cash payments for purchases.

Calculate Monthly Purchases:
		August	September	October	November
Budgeted ending inventory
Required available inventory
Required purchases
Calculate Payments Made for Inventory:
		---------- Purchases paid in ---------------
	Purchases	August	September	October	After October
August purchases
September purchases
October purchases
Determine Octobers Expected Cash Payments for Purchases.
October's expected cash payments for purchases