Doral Corp. has provided a part of its budget for the third quarter: JulyAugustSeptember Cash Collections$40,000 $45,000 $52,000 Cash Payments Purchases of Inventory 4,500 7,200 4,500 Operating Expenses 7,900 5,600 9,000 Capital expenditures 0 20,000 4,600 The cash balance on July 1 is $12,000. Assume that there will be no financing transactions or costs during the quarter. What is the cash balance at the end of September

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TUNDEXIGO TUNDEXIGO · Answer 1

Answer:

$39,600

Explanation:

Particulars Amount

Opening cash balance $12,000

Add: Cash collection $40,000

Total cash available $52,000

Less: Cash payment

Purchase of inventory $4,500

Operating expenses $7,900

Capital expenditure $0 $12,400

Cash balance at the end $39,600

AYOKENNY2001GO AYOKENNY2001GO · Answer 2

The cash balance at the end of September is $39,600

First, we'll determine the total cash available

Total cash available

= Opening cash balance + Cash collection

= 12,000 + 40,000

= 52,000

Cash balance at the end

The next step is to deduct the cash payments from the total cash available.

= Total cash available - (Purchase of inventory + Operating expenses + Capital expenditure)

= 52,000 - (4,500 + 7,900 - 0)

= 52,000 - 12,400

= 39,600

The cash balance at the end of September is $39,600

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