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) 1 2 3 4 Year Cash balance, beginning $6 $5 $5 $5 $6 Add collections from customers 73 120 415 Total cash available 79 125 Less disbursements: Purchase of inventory 55 65 55 31 Selling and administrative expenses 20 45 30 119 Equipment purchases 9 9 30 58 Dividends 2 2 2 2 Total disbursements 86 121 117 Excess (deficiency) of cash available over disbursements (7) 8 Financing: Borrowings 11 Repayments (including interest) * (21) Total financing Cash balance, ending *Interest will total $1,000 for the year.

Answer 1

Answer

--Requirement as asked

Cash Budget	Quarter (000 omitted)
	1	2	3	4	Year
Cash balance, beginning	$6	$5	$5	$5	$6
Add collections from customers	$73	$110	$120	$112	$415
Total cash available	$79	$115	$125	$117	$421
Less disbursements:
Purchase of inventory	$55	$65	$55	$31	$206
Selling and administrative expenses	$20	$45	$30	$24	$119
Equipment purchases	$9	$9	$30	$10	$58
Dividends	$2	$2	$2	$2	$8
Total disbursements	$86	$121	$117	$67	$391
Excess (deficiency) of cash available over disbursements	($7)	($6)	$8	$50	$30
Financing:
Borrowings	$12	$11	$0	$0	$23
Repayments (including interest) *	$0	$0	($3)	($21)	($24)
Total financing	$12	$11	($3)	($21)	($1)
Cash balance, ending	$5	$5	$5	$29	$29
*Interest will total $1,000 for the year.