Kelly Company is a retail sporting goods store that uses accrual accounting for its records. Facts regarding Kelly's operations are as follows:

l  Sales are budgeted at $220,000 for December year 1 and $200,000 for January year 2.

l  Collections are expected to be 60% in the month of sale and 38% in the month following the sale.

l  Gross margin is 25% of sales.

l  A total of 80% of the merchandise held for resale is purchased in the month prior to the month of sale and 20% is purchased in the month of sale. Payment for merchandise is made in the month following the purchase.

l  Other expected monthly expenses to be paid in cash are $22,600.

l  Annual depreciation is $216,000.

Below is Kelly Company's statement of financial position at November 30, year 1.

Assets   

A. $212,000.

B. $203,600.

C. $132,000.

D. $208,000.