A cash budget, by quarters, is given below for a retail company (000 omitted). T

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 $5,000 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.) Cash Budget Quarter (000 omitted) Year Cash balance, beginning Add collections from customers Total cash available Less disbursements 108 369 69 98 47 31 Purchase of inventory Selling and administrative expenses Equipment purchases Dividends 57 32 30 98 10 10 100 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. (14)

Explanation / Answer

Cash Budget :-

Particulars Qtr. 1 Qtr. 2 Qtr. 3 Qtr. 4 Year Cash Balance, Opening $6 $4 $4 $6 $6 Add : Collections from Customers 63 94 108 104 369 Total cash available (a) 69 98 112 110 375 Less : Disbursements : Purchase of inventory (47) (57) (50) (31) (185) Selling and Admin. Exp. (15) (32) (30) (21) (98) Equipment Purchase (10) (9) (22) (10) (51) Dividends (2) (2) (2) (2) (8) Total Disursements (74) (100) (104) (64) (342) Excess (Deficiency) of cash available over disbursements (5) (2) 8 46 33 Financing ;- Borrowings 9 6 - - 15 Repayments(including Interest)* - - (2) (14) 16 Total Financing 9 6 (2) (14) (1) Cash Balance, Ending 4 4 6 32 32

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