Star Co. is a retail store specializing in contemporary furniture. The following information is taken from Star’s June budget:

Sales                                                                                         $540,000
Cost of goods sold                                                                   300,000
Merchandise inventory–June 1                                              150,000
Merchandise inventory–June 30                                            180,000
Accounts payable for purchases–June                                1 85,000
Accounts payable for purchases–June 30                               75,000
What amount should Star budget for cash disbursements for June purchases?

  1. $260,000
  2. $280,000
  3. $320,000
  4. $340,000

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