AB Department Store expects to generate the following sales figures for the next three months:
July August September
Expected sales $480,000 $690,000 $540,000
AB's Cost of Goods Sold are 65% of sales dollars. At the end of each month, AB wants a merchandise inventory balance equal to 40% of the following month's expected sales, stated at cost. What amount of dollar merchandise inventory should AB plan to purchase in August?
A) $422,730
B) $345,870
C) $409,500
D) $384,300