Question

Baseball Corporation is preparing its cash budget for January. The budgeted beginning cash balance is $19,300. Budgeted cash receipts total $189,500 and budgeted cash disbursements total $190,600. The desired ending cash balance is $31,300. To attain its desired ending cash balance for January, the company should borrow: Multiple Choice $31,300 $0 $13,100 $49,500

Answer 1

The correct option is C). $13,100.

What is Budgeted cash receipts and Budgeted cash disbursements?

Budgeted cash receipts refer to the money that the company expects to receive in a specific period of time.

Budgeted cash disbursements are the payments that the company expects to make in a specific period of time.

As per given in the Question:

$19,300 + $189,500 - $190,600 =$18200

Here, $18,200 will be subtracted from $31,300 to determine the amount that the company needs to attain its desired ending cash balance:

$31,300 - $18,200= $13,100

According to this, the company should borrow $13,100.

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