A cash budget, by quarters, is given below for a retail company (000 omitted). T

Question

A cash budget, by quarters, is given below for a retail company (000 omitted). The company requires a minimum cash balance of at least $5,000 to start each quarter. Fill in the missing amounts. (Enter your answers in thousands of dollars. Cash deficiencies and Repayments should be indicated by a minus sign.)

A cash budget, by quarters, is given below for a retail company (000 omitted). The company requires a minimum cash balance of at least $5,000 to start each quarter. Fill in the missing amounts. (Enter your answers in thousands of dollars. Cash deficiencies and Repayments should be indicated by a minus sign.)

Cash Budget Quarter (000 omitted) Year Cash balance, beginning Add collections from customers Total cash available Less disbursements 8 106 367 29 Purchase of inventory Selling and administrative expenses Equipment purchases Dividends 45 32 8 2 97 30 20 2 45 2 Total disbursements Excess (deficiency) of cash available over disbursements Financing Borrowings Repayments (including interest)* Total financing Cash balance, ending *Interest will total $1,000 for the year

Explanation / Answer

1 2 3 4 Year Cash Budget $8 $5 $5 $5 $23 Add collections from customers $69 91 106 $101 $367 Total cash available $77 $96 $111 $106 $390 Less Disbursments Purchase of inventory 45 55 $50 29 $179 Selling and admin expenses 25 32 30 24 111 Equipment purchases 7 8 20 10 45 Dividends 2 2 2 2 8 Total disbursments 79 97 102 65 343 Excess (Deficiency of cash available over disbursments ($2) ($1) $9 $41 $47 Financing Borrowings 8 7 0 0 15 Repayments (including interest) -1 -1 -4 -11 -17 Total financing 7 6 -4 -11 -2 Cash balance ending $5 $5 $5 $30 $45

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