Simplicity Manufacturing expects to generate the following sales for the next three months: Simplicity's cost of gods sold is 60% of sales dollars. At the end of each month, Simplicity wants a merchandise inventory balance equal to 20% of the following month's expected cost of goods sold. What dollar amount of merchandise inventory should Simplicity plan to purchase in August?

Select one:

a. $257,400

b. $314,600

c. $352,800

d. $327,800

Simplicity Manufacturing expects to generate the following sales for the next three months: Simplicity's cost of gods sold is 60% of sales dollars. At the end of each month, Simplicity wants a merchandise inventory balance equal to 20% of the following month's expected cost of goods sold. What dollar amount of merchandise inventory should Simplicity plan to purchase in August? Select one: a. $257,400 b. $314,600 c. $352,800 d. $327,800