Question

based on the cash forecast, mahan corporation has a beginning cash balance of $5,000 in february, requires a minimum operating cash balance of $5,000, and has a net cash inflow of $25,000. how much will mahan corporation need to borrow? multiple choice question. $0

Answer 1

Mahan Corporation has a starting cash balance of $5,000 and a net cash inflow of $25,000 which results in no borrowing needed since the final cash balance will be $30,000, exceeding their minimum required balance. Therefore correct option is A

Step-by-step explanation:

The Mahan Corporation does not need to borrow any money. Since they have a beginning cash balance of $5,000, which already meets their requirement for a minimum operating cash balance, and they will have a net cash inflow of $25,000, their cash balance at the end of the period will be $30,000. This is well above the minimum required balance, so no borrowing is necessary.