Xolo Inc. had an August ending cash balance of $70,000. As well, it had sales of $60,000 in August, $80,000 in September, and projects sales of $95,000 for October, $115,000 for November, and $145,000 for December. The firm collects its receivables in the month after the sale. Given this information, calculate its cash balance at the end of November.

Question

Quizplus · Accepted Answer

The cash balance at the end of November includes the initial $70,000, plus collections from sales in the previous months. Collections start in September from August sales ($60,000), October from September sales ($80,000), November from October sales ($95,000). So, the total cash balance by the end of November is $70,000 + $60,000 + $80,000 + $95,000 = $305,000. The closest option to this calculation is $325,000.

Xolo Inc Had an August Ending Cash Balance of $70,000