1) For venture ZA, the beginning cash amounts for the months of October and Nove
ID: 2644355 • Letter: 1
Question
1) For venture ZA, the beginning cash amounts for the months of October and November are $25,000 and $30,000 respectively. The total sales are $200,000 and $300,000 for the months of October and November, respectively. It sells 80% on cash basis and 20% on credit. It collects its accounts receivable or credit sales 100% in the following month.
Find the total available cash for the month of November.
$250,000; $280,000; $300,000; $310,000; or $400,000
2) A venture has $400,000 and $470,000 cash available for the months of April and Mary respectively. Its total cash disbursements for merchandise wages and commissions, rent and truck purchases are $300,000 and $450,000 respectively. It desires a minimum cash balance of $50,000 each month.
Find the total cash needed for the months of April and May.
$350,000 & $500,000; $250,000 & $400,000; $150,000 & $230,000; $120,000 & $100,000; or $100,000 & $50,000
3) For venture XYZ has $400,000 cash available for the month of June. It needs for disbursements and minimum cash balance a total of $500,000 for the month of June.
Find the excess of total cash for the month of June.
$50,000; $(100,000); $40,000; $80,000; or $(150,000)
-- I would appreciate any help. --Thanks!
Explanation / Answer
1. For the month of November:
a) Beginning cash amount = $ 30,000
b) Cash collected from cash sales in November = $ 300,000 * 0.80 = $ 240,000
c) Cash collected from credit sales in October and paid in subsequent month, i.e., November = $ 200,000 * 0.20 = $ 40,000
Total cash available in November = (a) + (b) + (c) = $ 310,000
2.
Thus, the answer is $ 350,000 and $ 500,000
3. Cash available = $ 400,000
Disbursements + Cash balance required for the month= $ 500,000
Excess of total cash over requirement = Cash available - (Disbursement + Cash balance required for the month)
= $ 400,000 - $ 500,000
= $ (100,000)
April May Total cash disbursements for the month (a) $ 300,000 $ 450,000 Minimum cash balance desired (b) $ 50,000 $ 50,000 Total cash needed (a) + (b) $ 3,50,000 $ 500,000Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.