Dobson Company expects to begin operating on January 1. The company's master budget contained the following operating expense budget:

Sales commissions are paid in cash in the month following the month in which the expense is recognized. All other expense items requiring cash payment are paid in the month in which they are recognized. The amount of cash to be paid for operating expenses during the month of January is:
a. $53,600
b. $77,600
c. None of these
d. $51,800

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February 36,000 $ January 40,000 $ March 36,000 28,000 Salary expense Sales commissions, 5% of sales Utilities Depreciation on store equipment 24,000 30,000 2,800 2,800 2,800 1,800 1,800 1,800 Rent Miscellaneous 7,200 7,200 7,200 1,800 1,800 1,800 Total operating expenses 77,600 | $ 79,600 $ 77,600 %24