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Capital Candy Company sells boxes of assorted candies, which it purchases from its suppliers for...

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Accounting

Capital Candy Company sells boxes of assorted candies, which it purchases from its suppliers for $4.50 per unit. Sales vary throughout the year, but to ensure it always has stock on hand, it has a policy of requiring an ending inventory for any period to be large enough to cover 20% of the next period's demand. Budgeted sales (in units) for the year ended December 31,20X1 are as follows:
Q1-13,600
Q2-6,700
3-15,200
Q4-17,800
Assuming that inventory on hand at the beginning of each period matches that planned for in the policy above, what would be the cost of purchases for Q3?
a. $70,740
b. $98,100
c. $29,700
d. $84,420
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