Ask Question
4 January, 23:48

Southern Company is preparing a cash budget for April. The company has $12,000 cash at the beginning of April and anticipates $30,000 in cash receipts and $34,500 in cash disbursements during April. Southern Company has an agreement with its bank to maintain a minimum cash balance of $10,000. To maintain the required balance during April, the company must

+1
Answers (1)
  1. 5 January, 01:16
    0
    Borrowed amount - $2,500

    Explanation:

    The computation is shown below:

    = Opening balance of cash + expected cash receipts - cash disbursements - minimum balance

    = $12,000 + $30,000 - $34,500 - $10,000

    = $42,000 - $44,500

    = - $2,500

    The negative amount of $2,500 reflects the borrowed amount which is to be borrowed and are not sufficient balance to maintain the minimum cash balance
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Southern Company is preparing a cash budget for April. The company has $12,000 cash at the beginning of April and anticipates $30,000 in ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers