For the month of November,Whetzel Corporation.predicts total cash collections to be $1 million.Also for November,Whetzel Corporation.estimates that its beginning cash balance will be $50,000 and that it will borrow cash in the amount of $70,000.If Whetzel Corporation.estimates an ending cash balance of $30,000 for November,what must its projected cash disbursements be?

Question

Quizplus · Accepted Answer

Using the cash budget formula:
Beginning cash balance + Cash inflows - Cash outflows = Ending cash balance

We can plug in the given values and the unknown cash disbursement amount:
$50,000 + $1,070,000 - X = $30,000

Simplifying the equation, we get:
$1,070,000 - X = $30,000 - $50,000
$1,070,000 - X = -$20,000

Moving X to the left side of the equation, we get:
X = $1,090,000

Therefore, Whetzel Corporation's projected cash disbursements for November must be $1,090,000.

For the Month of November,Whetzel Corporation