Question

Baseball Corporation is preparing its cash budget for January. The budgeted beginning cash balance is $19,500. Budgeted cash receipts total $190,500 and budgeted cash disbursements total $191,000. The desired ending cash balance is $31,500. To attain its desired ending cash balance for January, the company should borrow:

Answer 1

$12,500

Step-by-step explanation:

Budgeted cash receipts refer to the money that the company expects to receive in a specific period of time.

Budgeted cash disbursements are the payments that the company expects to make in a specific period of time.

$19,500+190,500-191,000= 19,000

Then, you have to subtract 19,000 from 31,500 to determine the amount that the company needs to attain its desired ending cash balance:

31,500-19,000= 12,500

According to this, the company should borrow $12,500.