Bookworm Publishers publishes books and they have gathered the following data for the month of October: DataCash on 8/1 $7,000Expected Cash Collections $350,000Direct Materials Cash Disbursements $62,000Direct Labor Cash Disbursements $45,000MOH Cash Disbursements $43,000Operating Expenses Cash Disbursements $85,000Capital Expenditures Cash Disbursements $125,000Bookworm Publishers requires an ending cash balance of at least $5,000 and can borrow from a line of credit in $1,000 increments. What is the excess or deficiency of cash for October?

Question

Business

Marlon Barnett

27 November, 00:49

Bookworm Publishers publishes books and they have gathered the following data for the month of October: DataCash on 8/1 $7,000Expected Cash Collections $350,000Direct Materials Cash Disbursements $62,000Direct Labor Cash Disbursements $45,000MOH Cash Disbursements $43,000Operating Expenses Cash Disbursements $85,000Capital Expenditures Cash Disbursements $125,000Bookworm Publishers requires an ending cash balance of at least $5,000 and can borrow from a line of credit in $1,000 increments. What is the excess or deficiency of cash for October?

+5

Answers (1)

Know the Answer?

Nathalia Henderson · Answer 1

Bookworm

Inflow of cash

Opening cash balance = $7,000

Expected collections = >$350,000

Total inflow = $357,000

Outflow of cash

Direct Materials Cash Disbursements = $62,000

Direct Labor Cash Disbursements = $45,000

MOH Cash Disbursements = $43,000

Operating Expenses Cash Disbursements = $85,000

Capital Expenditures Cash Disbursements = $125,000

Total outflow = $360,000

Net cash deficit = - $3,000

Available credit line = $1,000

Cash deficit = $2,000