Neal Merchandising Company Expects to Purchase $90,000 of Materials in July

Multiple Choice

Neal Merchandising Company expects to purchase $90,000 of materials in July and $105,000 of materials in August. Three-quarters of all purchases are paid for in the month of purchase, and the other one-fourth are paid for in the month following the month of purchase. How much will August's cash disbursements for materials purchases be?

A) $67,500
B) $78,750
C) $101,250
D) $105,000