Charter Company Is Preparing Their Budget for the 1^st Quarter

Charter Company is preparing their budget for the 1^st quarter of 2012. The following data is provided:
$\begin{array}{|l|r|r|r|}\hline \text { Inventory, Purchases and COGS Budget } & \text { Jan } & \text { Feb } & \text { Mar } \\\hline \text { Cost of goods sold (a) } & \$ 30,000 & \$ 28,500 & \$ 22,500 \\\hline \text { Desired ending inventory(b) } & 10,700 & 9,500 & 9,800 \\\hline \text { Total inventory required } & 40,700 & 38,000 & 32,300 \\\hline \text { ess Beginning inventory } & (11,000 & (10,700) & (9,500 \\\hline \text { Purchases } & 29,700 & 27,300 & 22,800 \\\hline\end{array}$
(a) $\operatorname{COGS}=75 \%$ of sales
(b) $\$ 5.000+20 \%$ of COGS for next month
For the budgeted balance sheet at March 31, what amount should be shown for Inventory?

A) $9,500
B) $10,700
C) $8,750
D) $9,800