Quail Industries is preparing its cash budget for the third quarter of the current year.Sales for the third quarter are budgeted at $696,000 $232,000 per month.Sales are 80% cash,with the remaining 20% on credit which is collected in the month following the month of sale.On June 30,the cash balance is $38,400,and the Accounts Receivable all related to June sales balance is $40,800.Operating expenses for the quarter are budgeted at $371,200,which includes $14,400 of depreciation.Cash expenses are paid in the month incurred.Cash purchases for merchandise inventory are budgeted at $313,600 for the quarter.To prepare for the busy fourth quarter,Quail's desired cash balance on September 30 is $120,000.How much financing will the company need at the end of the third quarter?
A) $29,600
B) $61,600
C) $116,800
D) $15,200

Question

Quizplus · Accepted Answer

$696,000 x 80% + $232,000 x 20% x 2 - $313,600 - $356,800 + $38,400 + $40,800 = $58,400
$120,000 - $58,400 =$61,600

Quail Industries Is Preparing Its Cash Budget for the Third