Question

Varughese Inc. is working on its cash budget for March. The budgeted beginning cash balance is $33,000. Budgeted cash receipts total $182,000 and budgeted cash disbursements total $191,000. The desired ending cash balance is $40,000. To attain its desired ending cash balance for March, the company needs to borrow:

Answer 1

$16,000

Step-by-step explanation:

The computation of borrowing is shown below:-

Beginning cash balance = $33,000

Budgeted cash receipts = $182,000

cash disbursements = $191,000

Ending cash balance = $40,000

Company needs Borrowing = Beginning cash balance + cash receipts - cash disbursements - Ending cash balance

= $33,000 + $182,000 - $191,000 - $40,000

= $215,000 - $231000

= $16,000