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.) Cash Budget Quarter (000 omitted) 2 Year Cash balance, beginning Add collections from customers Total cash available Less disbursements: 102 357 83 Purchase of inventory Selling and administrative expenses Equipment purchases 51 32 8 112 13 16 47 93 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

Cash budget 1 2 3 4 total Beginning cash 8 5 5 5 23 + collection 75 82 102 98 357 Total 83 87 107 103 380 (-) disbursement Inventory purchase 41 51 48 33 173 Selling and administration exp 30 32 30 20 112 Equipment purchase 13 8 16 10 47 Dividend 2 2 2 2 8 Total (86) (93) 96 (65) 340 Excess/(deficiency) (3) (6) 11 38 40 Financing Borrowing 8 11 0 0 19 Repayment 0 0 (6) (14) (20) Total 8 11 (6) (14) (39) Ending balance 5 5 5 24 39

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