Chapter 16, Problem 16.4DMP

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Agarwal, Incorporated, has a 40-day average collection period and wants to maintain a minimum cash balance of $25 million, which is what the company currently has on hand. The company currently has a receivables balance of $188 million and has developed the following sales and cash disbursement budgets (in millions): Sales Total cash disbursement Q1 Q2 $ 369 $ 441 295 Q3 $ 522 389 617 Q4 $ 486 402 Complete 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 in millions rounded to the nearest whole million dollar amount, e.g., 32. AGARWAL, INCORPORATED Q1 Beginning receivables Sales Cash collections Ending receivables Cash Budget (in millions) 369 Q2 441 Q3 522 Q4 486 Total cash collections Total cash disbursements 295 389 617 402 Net cash inflow Beginning cash balance Net cash inflow Ending cash balance Minimum cash balance Cumulative surplus (deficit)

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