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Dilly Farm Supply is located in a small town in the rural west. Data regarding the store's operations follow:

• Sales are budgeted at $294,000 for November, $314,000 for December, and $214,000 for January.
• Collections are expected to be 70% in the month of sale and 30% in the month following the sale.
• The cost of goods sold is 75% of sales.
• The company desires to have an ending merchandise inventory at the end of each month equal to 80% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase.
• Other monthly expenses to be paid in cash are $21,500.
• Monthly depreciation is $23,000.
• Ignore taxes.

Balance Sheet October 31
Assets
Cash	$	27,000
Accounts receivable		79,000
Merchandise inventory		176,400
Property, plant and equipment, net of $624,000 accumulated depreciation		1,008,000
Total assets	$	1,290,400
Liabilities and Stockholders' Equity
Accounts payable	$	240,000
Common stock		744,000
Retained earnings		306,400
Total liabilities and stockholders' equity	$	1,290,400

The difference between cash receipts and cash disbursements for December would be:

Brewer 8e Rechecks 2019-26-08

Multiple Choice

• $88,250

• $54,000

• $34,250

• $27,000

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