Agarwal, Incorporated, has a 50-day average collection period and wants to maintain a minimum cash balance of $35 million, which iswhat the company currently has on hand. The company currently has a receivables balance of $192 million and has developed thefollowing sales and cash disbursement budgets (in millions):SalesQ1$ 405Q2$ 477Q3$ 558Total cash disbursement279415652Q4$ 522434edComplete the following cash budget for the company.Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers inmillions rounded to the nearest whole million dollar amount, e.g., 32.AGARWAL, INCORPORATEDCash Budget(in millions)Q1Q2Q3Q4Beginning receivables192225 $265$310SalesCash collections405477558522372437513542Ending receivablesEA$225265$310$290Total cash collections$372437$513$542Total cash disbursements279415652434Net cash inflow$93$22$139 × $108Beginning cash balance35$128GA$150$11Net cash inflow9322139 ×108Ending cash balance$35 ×35 × $35 × $35 ×Minimum cash balanceᏌᏊ$35 × $35 × $35 × $35Cumulative surplus (deficit)$93115$24 × $84

The average collection period is the amount of time it takes for a business to receive payments owed…

Answered: Agarwal, Incorporated, has a 50-day…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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