Question

Einstein Company is preparing its cash budget for the upcoming month. The beginning cash balance for the month is expected to be $10,000. Budgeted cash receipts are $85,000, while budgeted cash disbursements are $66,000. Einstein Company wants to have an ending cash balance of $25,000. The excess (deficiency) of cash available over disbursements for the month would be

Answer 1

The excess of cash available over disbursements for Einstein Company for the upcoming month is $29,000, calculated by adding the budgeted cash receipts to the beginning balance and then subtracting the budgeted cash disbursements.

Step-by-step explanation:

To calculate the excess (deficiency) of cash available over disbursements for Einstein Company in the upcoming month, we simply need to follow a standard cash budgeting approach:

• Begin with the starting cash balance.
• Add budgeted cash receipts.
• Subtract budgeted cash disbursements.

Beginning Cash Balance: $10,000
Budgeted Cash Receipts: +$85,000
Budgeted Cash Disbursements: -$66,000
Expected Ending Cash Balance (for reference): $25,000

Now, let's perform the calculation:

• $10,000 (beginning balance) + $85,000 (receipts) = $95,000
• $95,000 - $66,000 (disbursements) = $29,000

The excess of cash available over disbursements for the month would be $29,000. This is before considering any external financing or investments needed to meet the desired ending cash balance.

Answer 2

$29,000

Step-by-step explanation:

Calculation would be as follows:

Particular Amount ($)

Beginning Cash 10,000

Add: Cash Receipt 85,000

Less: Cash Disbursement (66,000)

Cash Available 29,000

Hence, the cash available over disbursement for the month would be $29,000.