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29 September, 01:14

Laurey Inc. is working on its cash budget for May. The budgeted beginning cash balance is $45,000. Budgeted cash receipts total $129,000 and budgeted cash disbursements total $124,000. The desired ending cash balance is $60,000.

How much does the company need to borrow to attain its desired ending cash balance for May?

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  1. 29 September, 02:34
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    the company needs to obtain $10,000 from external sources to attain its desired cash balance for May.

    Explanation:

    additional funds needed:

    - budgeted beginning cash balance = $45,000

    - budgeted cash receipts = $129,000

    + budgeted cash disbursements = $124,000

    + desired ending cash balance = $60,000

    AFN = $124,000 + $60,000 - $45,000 - $129,000 = $10,000,

    the company needs to obtain $10,000 from external sources to attain its desired cash balance for May.
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