Boone Hobbies, a wholesaler, has a sales budget for next month of $600,000. Cost of units sold

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Question:

Boone Hobbies, a wholesaler, has a sales budget for next month of $600,000. Cost of units sold is expected to be 40 percent of sales. All units are paid for in the month following purchase. The beginning inventory of units is $20,000, and an ending amount of$24,000 is desired. Beginning accounts payable is $152,000.

Boone Hobbies gross margin for next month is expected to be

A. $240,000.

B. $280,000.

C. $336,000.

D. $356,000.

E. $360,000.