Question

The following information was taken from Pina Colada Corp. cash budget for the month of July: Beginning cash balance $138000 Cash receipts 132000 Cash disbursements 187000 If the company has a policy of maintaining an end of the month cash balance of $138000, the amount the company would have to borrow is $82500. $41000. $27500. $55000.

Answer 1

$55000

Step-by-step explanation:

Given:

• Beginning cash balance $138000
• Cash receipts $132000
• Cash disbursements -$187000
• Cash balance: $83000

Because the company has a policy of maintaining an end of the month cash balance of $138000, so the amount the company would have to borrow:

= The maintaining balance cash flow - The actual cash balance

= $138000 - $83000

= $55000

Hope it will find you well.