(TCO F) Payment Inc. is preparing its cash budget for February. The budgeted beg

Question

(TCO F) Payment Inc. is preparing its cash budget for February. The budgeted beginning cash balance is $27,000. Budgeted cash receipts total $136,000 and budgeted cash disbursements total $128,000. The desired ending cash balance is $50,000. The company can borrow up to $110,000 at any time from a local bank, with interest not due until the following month.

Required:

Prepare the company's cash budget for February in good form. Make sure to indicate what borrowing, if any, would be needed to attain the desired ending cash balance

Explanation / Answer

now ending cash for July = beginning cash +cash receipt -cash disbursement =$35,000 since desired ending cash = $50,000 cash borrowed from the bank = 50,000- 35,000 = $15,000 (answer) so for july budget beginning cash cash receipt cash disbursement money borrowed ending cash $27,000 $136,000 $128,000 $15,000 $50,000

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