Griswald Inc.would like to prepare a summary cash budget for the first quarter of 2009.The following information from the cash receipts and cash disbursements budgets are available:
$\begin{array}{rrr}
&\underline{\text { January}} &\underline{\text { February } }&\underline{\text { March }}\
\text { Cash receipts }&\$ 50000 & \$ 72000 & \$ 80000 \
\text { Cash disbursements }&42000 & 75000& 71000
\end{array}$
The company has a beginning cash balance on 1 January 2009 of $5000.No other receipts and disbursements in the first quarter are expected.What is the cash balance at the end of March expected to be?
A) $14 000
B) $19 000
C) $ 9000
D) $34 000

Question

Griswald Inc.would like to prepare a summary cash budget for the first quarter of 2009.The following information from the cash receipts and cash disbursements budgets are available:
$\begin{array}{rrr}
&\underline{\text { January}} &\underline{\text { February } }&\underline{\text {  March }}\
\text { Cash receipts }&\$ 50000 & \$ 72000 & \$ 80000 \
\text { Cash disbursements }&42000 & 75000& 71000
\end{array}$ 
The company has a beginning cash balance on 1 January 2009 of $5000.No other receipts and disbursements in the first quarter are expected.What is the cash balance at the end of March expected to be?
A) $14 000
B) $19 000
C) $ 9000
D) $34 000

Quizplus · Accepted Answer

The cash balance at the end of March is calculated by adding the beginning cash balance and total cash receipts, then subtracting total cash disbursements: $5000 + ($50000 + $72000 + $80000) - ($42000 + $75000 + $71000) = $19000.

Griswald Inc The Company Has a Beginning Cash Balance on 1 January