Labor costs are 30% of sales. Other operating costs are $38,000 per month (including $10,000 of depreciation). Both of these are

Question

3 years ago

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Labor costs are 30% of sales. Other operating costs are $38,000 per month (including $10,000 of depreciation). Both of these are

paid in the month incurred. The cash balance on March 1 is $8,000. A minimum cash balance of $6,000 is required at the end of the month. Money can be borrowed in multiples of $1,000. How much cash will be disbursed in total in March

Business

1 answer:

Alina [70] · Answer 1 · 2022-05-19T09:25:05+03:00

$14,000 rupees will be disbursed totally in march.

<u>Explanation</u>:

The operating cost is $38,000 per month. This is including depreciation. So cash pending on March 1 is $8,000.
At the end of March month, the cash balance of $6000 is required. So a total of $14,000 is required at the end of the month. Including the labor costs, he wants to pay $14,000.
He can borrow money in multiples of $1000. For emergencies, this money can be borrowed. So $14,000 should be dispersed in the month of March.