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 $4,000 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.)
Quarter (000 omitted) 1 2 3 4 Year Cash balance, beginning Add collections from customers Total cash available 7 109 392 89 Less disbursements: Purchase of inventory 48 58 32 Selling and administrative expenses 45 30 127 Equipment purchases 11 23 53 Dividends 2 2 2 2 Total disbursements Excess (deficiency) of cash available over disbursements 114 (2) 7 Financing: Borrowings 18 Repayments (including interest) (22) Total financing Cash balance, ending

Answer 1

						Quarter (000 omitted)
						1	2	3	4	Year
	Cash balance,beginning					7	4	4	4
	Add: Collections from customers					82	96	109	105	392
						(89-7)	(100-4)		(392-82-96-109)
	Total cash available					89	100	113	109	411
							(114-14)	(4+109)
	Less: Disbursements
	Purchase of inventory					48	58	51	32	189
								(106-2-23-30)
	Selling and administrative expenses					23	45	30	29	127
						(84-48-11-2)			(127-23-45-30)
	Equipment purchases					11	9	23	10	53
									(53-23-9-11)
	Dividends					2	2	2	2	8
	Total disbursements					84	114	106	73	377
						(82+2)		(113-7)
	Excess (deficiency) of cash available over disbursements (a)					-2	-14	7	36
							(-18+4)
	Financing:
	Borrowings				b	6	18	0	0	24
						(4+2)
	Repayments (including interest)*				c	0	0	-3	-22	-25
								(7-4)
	Total financing				d=b+c	6	18	-3	-22	-1
	Cash balance,ending				e=a+d	4	4	4	14
							(Note:1)
	Note:1 -Minumum balance required=$ 40000