On June 30, Alpha Company's cash balance is $4,000
Alpha is now preparing their cash budget for the third quarter of the year. The following data is provided:
Cash budget July Aug Sep
Beginning cash balance $4,000 $8,000 $6,958
Plus: Cash collections 50,000 40,000 49,000
Cash available $54,000 $48,000 $55,958
Less: Cash payments
Purchases of direct materials 31,000 22,000 17,100
Operating expenses 12,000 9,000 11,000
Capital expenditures 13,000 25,000 0
Interest expense at 5% 0 42 104
Less: Total cash payments $56,000 $56,042 $28,204
Ending cash balance before financing $(2,000 ) $(8,042 ) $27,754
Minimum cash balance desired (5,000 ) (5,000 ) (5,000 )
Cash excess/(deficiency) $(7,000 ) $(13,042 ) $22,754
Financing
Borrowing at end of month 10,000 15,000
Principal repayments at end of month $(20,000 )
Total effects of financing 10,000 15,000 (20,000 )
Ending cash balance $8,000 $6,958 $7,754
The amount of cash that should be shown in the budgeted balance sheet as of September 30 would be ________.
A) $6,958
B) $55,958
C) $7,754
D) $22,754
C
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