Question

Exercise 8-11 Cash Budget Analysis (LO8-8] A cash budget, by quarters, is given below for a retail company (000 omitted). The company requires a minimum cash balance of at least $8,000 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.) (000 omitted) Year 1 1 4 $ Quarter (000 omitted) 2 3 71 97 80 335 36 46 28 7 Cash balance, beginning Add collections from customers Total cash available Less disbursements: Purchase of inventory Selling and administrative expenses Equipment purchases Dividends 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. 1 0 2 111 2 2 21 (2) 171 16 (18)

Answer 1

Quarter (000 omitted) (000 omitted) 1 2 3 4 Year Cash balance Beginning Add: collections from customers 7 S 73 S 8S 97 S 105 S 7 72 S 80 S 93 S 101 S 335 Total cash available Less: disbursements Purchase of Inventory Selling and administrative Expenses Equipment Purchases Dividends Total Disbursements Exess (deficiency) of cash available over disbursements Financing Borrowings Repayments (Inchuding Interest) Total Financing Cash balance Ending 80 S 342 36 S 37 S 7S 2 S 82 S 46 S 30 S 10 S 45 S 30 S 11 S 2 S 88 S 17 S 28 S 20 S 10 S 2 S 60 S 41 S S 155 S 117 38 88 S (8) S S 318 (2) S S 24 10 S $ 16 26 (27) (1) (9)S (9) S (18) S (18) S 23 S 10 S 16 S S 23