Western Company is preparing a cash budget for June. The company has $1,600 cash

Question

Western Company is preparing a cash budget for June. The company has $1,600 cash at the beginning of June and anscipates $30.400 in cash receipts and $35.300 in cash disbursements during June. Westerm Company has an agreement with its bank to maintain a minimum cash balance of $10.000 As of May 31, the company owes $15,000 to the bank. To maintain the $10,000 required balance, during June the company must Multiple Choice Bomow $10 .000 Repay 53.300 0?woo o $4,900 Bomon 51.300 6 command option command

Explanation / Answer

E. Borrow $3,300

Beginning cash balance $11,600 Add cash receipts $30,400 Less cash disbursements ($35,300) Cash balance before financing $6,700 Desired cash balance $10,000 Amount to borrow $3,300

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