The beginning cash balance is $3,000, estimated cash receipts are $105,000, and estimated cash disbursements are $111,000. How much cash must be borrowed to have a desired ending balance of $5,000?

Question

Quizplus · Accepted Answer

To find out how much cash must be borrowed, calculate the ending cash balance without borrowing: $3,000 (beginning balance) + $105,000 (receipts) - $111,000 (disbursements) = -$3,000. To achieve a desired ending balance of $5,000, $8,000 must be borrowed (-$3,000 + $8,000 = $5,000).

The Beginning Cash Balance Is $3,000, Estimated Cash Receipts Are