The cash budget for the first three quarters of the HCASH-420 company is given below (000 omitted. The company requires a minimum cash balance of $5.000 to start each quarter if necessary, the company will bomow money from its bank to maintain this balance. The company will pay no interest in Quarters 1, 2 and 3. It will repay as much of its borrowings as possible as soon as It has more than $5.000 In cash in a given quarter Suppose the company starts the first quarter with no bank debt. How much total bank debt does the company expect to have at the end of the third quarter? Cash Budget Quarter (000 omitted) 1 2 3 Cash balance beginning $8 Add collections from customers 88 7 Total cash available Less disbursements Purchase of inventory 56 Selling and administrative expenses 40 Equipment purchases 8 Dividends 2 Total disbursements Excess (deficiency of cash available over disbursements Financing Borrowings Reptyments Total financing Cash balance, ending Multiple Choice OOOO $6.000 $15,000 $49.000 $40.000 127 7 65 45 9 2 ? 7 89 65 51 11 2

The cash budget for the first three quarters of the HCASH-420 company is given below (000 omitted. The company requires a minimum cash balance of $5.000 to start each quarter if necessary, the company will bomow money from its bank to maintain this balance. The company will pay no interest in Quarters 1, 2 and 3. It will repay as much of its borrowings as possible as soon as It has more than $5.000 In cash in a given quarter Suppose the company starts the first quarter with no bank debt. How much total bank debt does the company expect to have at the end of the third quarter? Cash Budget Quarter (000 omitted) 1 2 3 Cash balance beginning $8 Add collections from customers 88 7 Total cash available Less disbursements Purchase of inventory 56 Selling and administrative expenses 40 Equipment purchases 8 Dividends 2 Total disbursements Excess (deficiency of cash available over disbursements Financing Borrowings Reptyments Total financing Cash balance, ending Multiple Choice OOOO $6.000 $15,000 $49.000 $40.000 127 7 65 45 9 2 ? 7 89 65 51 11 2

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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A cash budget, by quarters, is given below for a retail company (000 omitted). The company requires a minimum cash balance of at least $3,000 to start each quarter. Required: Fill in the missing amounts. (Enter your answers in thousands of dollars. Cash deficiencies and Repayments should be indicated by a minus sign.) 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. Quarter 1 (000 omitted) $ 9 97 54 7 2 (5) Quarter 2 (000 omitted) 64 45 9 2 120 12 Quarter 3 (000 omitted) 124 30 29 2 12 Quarter 4 (000 omitted) 30 2 (12) Year (000 omitted) 431 137 55
Cheyenne Company has budgeted the following information for June: Cash receipts Beginning cash balance Cash payments Desired ending cash balance If there is a cash shortage, the company borrows money from the bank. All cash is borrowed at the beginning of the month in $1,000 increments, and interest is paid monthly at 1% on the first day of the following month. The company had no debt before June 1. The amount of interest paid on July 1 would be: Multiple Choice $590. $ 339,000 22,000 382,000 42,000 $476.
Motors Corporation manufactures motors for dirt bikes. The company requires a minimum $30,000 cash balance at each month-end. If necessary, the company borrows to meet this requirement at a cost of 3% interest per month (paid at the end of each month). Any preliminary cash balance above $30,000 at month-end is used to repay loans. The cash balance on July 1 is $43,000, and the company has no outstanding loans. Budgeted cash receipts and budgeted cash payments (other than for interest on the loan and loan activity) follow. July Cash receipts Cash payments $ 94,000 122,000 August September $120,000 108,900 $ 159,000 136,400 Prepare a cash budget for July, August, and September. Note: Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar. Answer is not complete. MOTORS CORPORATION Cash Budget July August September Beginning cash balance $ 43,000 $ 30,000 $ 30,000 Add: Cash receipts 94,000 120,000…
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. Required: Fill in the missing amounts. (Enter your answers in thousands of dollars. Cash deficiencies and Repayments should be indicated by a minus sign.) 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 6 69 47 10 2 (5) Quarter (000 omitted) 2 3 57 32 9 2 100 6 108 30 22 2 7 4 31 2 (13) (000 omitted) Year 369 98 51
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Am. 1113.
Urban Industries needs to maintain a minimum cash balance of $10,000 and has entered into an agreement with their bank to accomplish this. Urban is preparing a cash budget for September. Urban has $11,300 in cash at the beginning of September and anticipates $30,700 in cash receipts and $35,900 in cash payments during September. As of August 31, the company has no loans outstanding. To maintain the $10,000 required balance, during September the company must: O A. Borrow $3,900. O B. Borrow $10,000. OC. Borrow $5,200. OD. Repay $3,900. OE.Repay $6.100.
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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. Required: Fill in the missing amounts. Note: Enter your answers in thousands of dollars. Cash deficiencies and Repayments should be indicated by a minus sign. 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 S 70 42 14 2 (8) Quarter (000 omitted) 2 3 52 32 8 2 94 10 103 30 17 2 14 4 34 2 (21) (000 omitted) Year 347 103 49
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The company wants to maintain a minimum cash balance of $35,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter. Principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000. Interest is 6% per year and paid at the beginning of the quarter based on the amount outstanding from the previous quarter Kiara's Coats Cash Budget For the year ended December 31, 2021 First Quarter Second Quarter Third Quarter Fourth Quarter Total Beginning cash balance $38,000 $35,569 $35,185 Cash receipts $71,600 $75,400 91,650 107,900 346,550 Cash available $109,600 $110,969 126,835 Cash payments: Total cash payments before interest $107,031 $52,289 57,755 63,639 280,714 Interest expense $0 $495 495 Total cash payments $107,031 $52,784 58,250 Ending cash balance before financing $2,569 $58,185 68,535 Minimum cash balance desired…