Sophia, Inc

Multiple Choice

Sophia, Inc.is preparing its cash budget for the fourth quarter.The inventory manager advises that materials purchases will be $40,000 in October and will increase by 25% for each month thereafter due to the holiday season.Sophia's purchases in September were $32,000.Sophia pays for purchases 50% in the month after sale and 50% in the 2nd month after the sale.What are Sophia's budgeted cash payments for purchases in November?

A) $45,000
B) $36,000
C) $61,000
D) $40,000