Answer:
Beginning cash balance for March= $20,000
Cash collections for February =$90,600
Total cash available for March =$102,300
Cash payments (purchase inventory) for February =$50,800
Cash payments (operating expenses) for March =$37,900
Total cash payments for March =$79,400
Ending cash balance before
financing for February =$8,400
Cash excess (deficiency) for February and March =$- 11,600 $2,900
New borrowings for February and March
=$11,600 $0
Debt repayments for February and March
=$0 -$2,900
Interest payments for February and March
=$0 $0
Ending cash balance for February and March (1) + (2) =$20,000 $20,000
Explanation
Preparation of Raymond Adventures
Combined Cash Budget for February and March
Raymond Adventures Combined Cash Budget for February and March
Beginning cash balance 16,500 20,000
Plus: Cash collections 90,600 80,200
Plus: Cash from sale of plant assets 0 2,100
Total cash available 107,100 102,300
Less: Cash payments
(purchase inventory) 50,800 41,500
Less: Cash payments
(operating expenses) 47,900 37,900
Total cash payments 98,700 79,400
(1) Ending cash balance before
financing 8,400 22,900
Minimum cash balance desired 20,000 20,000
Cash excess (deficiency) -11,600 2,900
Financing:
Plus: New borrowings 11,600 0
Less: Debt repayments 0 -2,900
Less: Interest payments 0 0
(2) Total effects of financing 11,600 -2,900
Ending cash balance (1) + (2) 20,000 20,000
Beginning cash balance for March
Minimum cash balance desired March 20,000
Calculation for Cash collections for February
Total cash available 107,100-Beginning cash balance 16,500=90,600
Calculation for Total cash available for March
Beginning cash balance 20,000
Plus: Cash collections 80,200
Plus: Cash from sale of plant assets 2,100
=102,300
Calculation for Cash payments (purchase inventory) for February
Total cash payments 98,700 -Cash payments
(operating expenses) 47,900
=50,800
Calculation for Cash payments (operating expenses) for March
Total cash payments for March 79,400-Cash payments(purchase inventory) for March 41,500
=37,900
Calculation for Total cash payments for March
Total cash available for March 102,300-Ending cash balance before
financing for March 22,900
=79,400
Calculation for the Ending cash balance before
financing for February
Total cash available 107,100-Total cash payments 98,700
=8,400
Calculation for Cash excess (deficiency) for February and March
Ending cash balance before
financing 8,400 22,900
Less Minimum cash balance desired 20,000 20,000
=- 11,600 2,900
New borrowings for February and March
11,600 0
Debt repayments for February and March
0 -2,900
Interest payments for February and March
0 0
Calculation for Ending cash balance for February and March (1) + (2)
(1) Ending cash balance before
financing 8,400 22,900
Add (2) Total effects of financing 11,600 -2,900
=20,000 20,000
