Warbel Company is preparing a cash budget for the month of June.The following information is available:
$\begin{array}{ll}
\text { Cash Balance, May 31, 2015 } & \$ 11,000 \
\text { Cash collections from customers in June } & 43,000 \
\text { Cash paid for merchandise in June } & 20,000 \
\text { Cash paid for operating expenses in June } & 20,000 \
\text { Paid cash dividend in June } & 5,000
\end{array}$
The minimum cash balance desired is $5,000.What is the cash balance on June 30,2015?
A) $8,000
B) $9,000
C) $10,000
D) $13,000

Question

Quizplus · Accepted Answer

The cash balance on June 30, 2015, is calculated as follows: Starting balance ($11,000) + Cash collections ($43,000) - Cash paid for merchandise ($20,000) - Cash paid for operating expenses ($20,000) - Cash dividend ($5,000) = $9,000.

Warbel Company Is Preparing a Cash Budget for the Month