Vela Enterprises Inc would like to prepare a summary cash budget for March. The following information is available: · The cash balance at March 1 was estimated to be $3,000. · March sales, all on account, were estimated to be $50,000. Sales are collected over a two-month period with 65 percent collected in the month of sale and the remainder in the subsequent month. February sales on account
were $60,000. · Inventory purchases are expected to be $20,000 in March. The company pays for one-half of inventory purchases in the month of purchase and the remainder in the subsequent month. February's purchases were $18,000. · Cash disbursements for selling and administrative expenses are expected to be $4,000 in March. · Depreciation expense for March is expected to be $5,000. · Loan and interest payments for March are expected to be $25,000. What is the cash balance at the end of March expected to be?
A) $ 8,500
B) $ (3,500)
C) $ 3,500
D) $26,500
A
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