Wallace Company provides the following data for next year:

Month Budgeted Sales January $120,000 February 108,000 March 140,000 April 147,000

The gross profit rate is 35% of sales. Inventory at the end of December is $29,600 and target ending inventory levels are 10% of next month's sales, stated at cost.

What is the amount of purchases budgeted for January?

Group of answer choices

A $85,020

B $70,980

C $78,000

D $55,420