Upstairs Company has the following data:

Month Budgeted Sales January $108,000 February 132,000 March 144,000 April 120,000 The gross profit rate is 40% of sales and ending inventory at December 31 was $19,440. Desired ending inventory levels are 30% of next month's sales at cost. What are the expected total purchases for February?

A) $79,200

B) $81,360

C) $102,960

D) $105,120

Answer: B The correct option:B) $ 81,360

Can someone show me the steps to below numbers? the calculation steps? Please

Month	Jan	Feb	Mar
Budgeted Cost of Goods Sold ( 60% of budgeted sales) 100-40=60%	64,800	79,200	86,400
Desired ending inventory	23,760	25,920
Total inventory needed	88,560	105,120
Less : Beginning Inventory	19,440	23,760
Purchases required	69,120	81,360