Operational budgets are used by a retail company for planning and controlling its business activities. Data regarding the company's monthly sales for the last 6 months of the year and its projected...

Extracted text: Operational budgets are used by a retail company for planning and controlling its business activities. Data regarding the company's monthly sales for the last 6 months of the year and its projected collection patterns shown below: The cost of merchandise averages 40% of its selling price. The company's policy is to maintain an inventory equal to 25% of the next month's forecasted sales. The inventory balance at cost is P 80,000 as of June 30. Forecasted sales July P 775,000 August 750,000 September 825,000 October 800,000 November 850,000 December 900,000 Types of sales Cash sales 20% Credit sales 80% Collection pattern for credit sales In the month of sale 40% In the first month following the sale 57% Uncollectible 3% The budgeted cost of the company's purchases for the month of august would be