Memphis Company's May sales budget calls for sales of $880,000. The store expects to begin May with $48,000 of inventory and to end the month with $53,000 of inventory. Gross margin is typically 45% of sales. Compute the budgeted cost of merchandise purchases for May.

Multiple Choice

• $479,000.

• $489,000.

• $484,000.

• $396,000.

• $401,000