On July 1, the inventory of at Barnett Shoes was $38,000. Because of anticipated back-to-school sales, the owner wants to have an inventory of $78,000 on hand at the beginning of August. Net sales during July are expected to total $74,000, with a gross profit rate of 45%. During July, the company should purchase merchandise costing:

Multiple Choice

$40,700.

$118,700.

$80,700.

$78,000.