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Smiths Company provides the following data for next year: Month Budgeted Sales...

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Accounting

Smiths Company provides the following data for next year:

Month Budgeted Sales

January $120,000

February 108,000

March 132,000

April 144,000

The gross profit rate is 35% of sales. Inventory at the end of December is $21,600 and target ending inventory levels are 20% of next month's sales, stated at cost.

What is the amount of purchases budgeted for February?

A) $95,160

B) $73,320

C) $70,200

D) $32,214

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