Webster Corporation is preparing its cash budget for April T

Webster Corporation is preparing its cash budget for April. The March 31 cash balance is $40,400. Cash receipts are expected to be $661,000 and cash payments for purchases are expected to be $618,500. Other cash expenses expected are $29,000 selling and $35,500 general and administrative. The company desires a minimum cash balance at the end of each month of $34,000. If necessary, the company borrows enough cash to meet the minimum using a short-term note. The amount Webster must borrow during April is:

Solution

Ans $ 15600

		(AMOUNT IN $)
	DESIRED CLOSING BALANCE	34,000
LESS	OPENING CASH BALANCE	40,400
LESS	CASH RECEIPTS	661,000
ADD	CASH PAYMENTS	618,500
ADD	SELLING EXPENSES	29,000
ADD	GENERAL AND ADMINISTRATIVE EXPENSES	35,500
	AMOUNT TO BE BORROWED	15,600