15) Berkeley Products has a cash balance of $20,000 at April 1, 2011. They are now preparing the cash budget for
the second quarter. Budgeted cash collections and payments are as follows:
Apr May Jun
Cash collections $12,000 $9,000 $10,500
Cash payments:
Purchases of inventory 4,600 4,200 4,000
Operating expenses 5,000 5,200 4,800
There are no budgeted capital expenditures or financing transactions during the quarter. Based on the above data,
what is the projected cash balance at the end of April?
A) $22,000
B) $21,900
C) $23,700
D) $22,400
16) Berkeley Products has a cash balance of $20,000 at April 1, 2011. They are now preparing the cash budget for
the second quarter. Budgeted cash collections and payments are as follows:
Apr May Jun
Cash collections $12,000 $9,000 $10,500
Cash payments:
Purchases of inventory 4,600 4,200 4,000
Operating expenses 5,000 5,200 4,800
There are no budgeted capital expenditures or financing transactions during the quarter. Based on the above data,
what is the projected cash balance at the end of May?
A) $22,000
B) $21,900
C) $23,700
D) $22,400
17) Berkeley Products has a cash balance of $20,000 at April 1, 2011. They are now preparing the cash budget for
the second quarter. Budgeted cash collections and payments are as follows:
Apr May Jun
Cash collections $12,000 $9,000 $10,500
Cash payments:
Purchases of inventory 4,600 4,200 4,000
Operating expenses 5,000 5,200 4,800
There are no budgeted capital expenditures or financing transactions during the quarter. Based on the above data,
what is the projected cash balance at the end of June?
A) $22,000
B) $21,900
C) $23,700
D) $22,400
18) Zygot Biotech Company is budgeting for the 3rd quarter, and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 0 19,000 0
The cash balance at June 30 is projected to be $5,600. There are no financing transactions planned in the 3rd
quarter. What is the projected cash balance at the end of July?
A) $21,000
B) $12,600
C) $18,000
D) $2,600
19) Zygot Biotech Company is budgeting for the 3rd quarter, and provide the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 0 19,000 0
The cash balance at June 30 is projected to be $5,600. There are no financing transactions planned in the 3rd
quarter. What is the projected cash balance at the end of August?
A) $21,000
B) $12,600
C) $18,000
D) $2,600
20) Zygot Biotech Company is budgeting for the 3rd quarter, and provide the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 0 19,000 0
The cash balance at June 30 is projected to be $5,600. There are no financing transactions planned in the 3rd
quarter. What is the projected cash balance at the end of September?
A) $21,000
B) $12,600
C) $18,000
D) $2,600
21) Felton Manufacturing provides the following data excerpted from its 3rd quarter budget:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 0 25,000 0
The cash balance at June 30 is projected to be $4,000. Based on the above data, how much cash shortfall is the
company projected to have at the end of August?
A) $6,500
B) $2,700
C) $5,000
D) $4,770
22) AAA Company is preparing its 3rd quarter budget and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 13,000 25,000 0
Cash balance at June 30 is projected to be $4,000. The company is required to maintain a minimum cash balance of
$5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments
of $5,000 and pays interest monthly at an annual rate of 5%. All financing transactions are assumed to take place at
the end of the month. Loan balance should be repaid in increments of $5,000 when there is surplus cash.
How much cash shortfall will the company have at the end of July, before financing?
A) $2,000
B) $6,500
C) $5,000
D) $1,250
23) AAA Company is preparing its 3rd quarter budget and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 13,000 25,000 0
Cash balance at June 30 is projected to be $4,000. The company is required to maintain a minimum cash balance of
$5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments
of $5,000 and pays interest monthly at an annual rate of 5%. All financing transactions are assumed to take place at
the end of the month. Loan balance should be repaid in increments of $5,000 when there is surplus cash.
How much will the company have to borrow at the end of July?
A) $0
B) $5,000
C) $15,000
D) $10,000
24) AAA Company is preparing its 3rd quarter budget and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 13,000 25,000 0
Cash balance at June 30 is projected to be $4,000. The company is required to maintain a minimum cash balance of
$5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments
of $5,000 and pays interest monthly at an annual rate of 5%. All financing transactions are assumed to take place at
the end of the month. Loan balance should be repaid in increments of $5,000 when there is surplus cash.
What is the budgeted cash balance at the end of July, after required financing transactions?
A) $0
B) $5,000
C) $3.000
D) $8,000
25) AAA Company is preparing its 3rd quarter budget and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 13,000 25,000 0
Cash balance at June 30 is projected to be $4,000. The company is required to maintain a minimum cash balance of
$5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments
of $5,000 and pays interest monthly at an annual rate of 5%. All financing transactions are assumed to take place at
the end of the month. Loan balance should be repaid in increments of $5,000 when there is surplus cash.
What is the projected cash shortfall at the end of August, before financing transactions have been taken into
consideration?
A) $0
B) $5,000
C) $3.000
D) $8,000
26) AAA Company is preparing its 3rd quarter budget and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 13,000 25,000 0
Cash balance at June 30 is projected to be $4,000. The company is required to maintain a minimum cash balance of
$5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments
of $5,000 and pays interest monthly at an annual rate of 5%. All financing transactions are assumed to take place at
the end of the month. Loan balance should be repaid in increments of $5,000 when there is surplus cash.
How much will the company have to borrow at the end of August?
A) $0
B) $5,000
C) $10.000
D) $15,000
27) AAA Company is preparing its 3rd quarter budget and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 13,000 25,000 0
Cash balance at June 30 is projected to be $4,000. The company is required to maintain a minimum cash balance of
$5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments
of $5,000 and pays interest monthly at an annual rate of 5%. All financing transactions are assumed to take place at
the end of the month. Loan balance should be repaid in increments of $5,000 when there is surplus cash.
What will the final cash balance be at the end of August, after all required financing transactions have been taken
into consideration?
A) $6,958
B) $5,254
C) $7,100
D) $4,320
28) AAA Company is preparing its 3rd quarter budget and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 13,000 25,000 0
Cash balance at June 30 is projected to be $4,000. The company is required to maintain a minimum cash balance of
$5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments
of $5,000 and pays interest monthly at an annual rate of 5%. All financing transactions are assumed to take place at
the end of the month. Loan balance should be repaid in increments of $5,000 when there is surplus cash.
What amount of principal should the company repay to the bank at the end of September?
A) $5,000
B) $10,000
C) $15,000
D) $20,000
29) AAA Company is preparing its 3rd quarter budget and provides the following data:
Jul Aug Sep
Cash collections $50,000 $40,000 $48,000
Cash payments:
Purchases of inventory 31,000 22,000 18,000
Operating expenses 12,000 9,000 11,600
Capital expenditures 13,000 25,000 0
Cash balance at June 30 is projected to be $4,000. The company is required to maintain a minimum cash balance of
$5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments
of $5,000 and pays interest monthly at an annual rate of 5%. All financing transactions are assumed to take place at
the end of the month. Loan balance should be repaid in increments of $5,000 when there is surplus cash.
What is the final projected cash balance at the end of September?
A) $6,000
B) $5,254
C) $6,133
D) $7,200
30) June sales were $40,000 while projected sales for July and August were $50,000 and $60,000, respectively.
Sales are 40% cash and 60% credit. All credit sales are collected in the month following the sale. What are the
expected collections for July?
A) $36,000
B) $44,000
C) $50,000
D) $54,000
31) Purchases for May were $100,000, while expected purchases for June and July are $110,000 and $125,000,
respectively. All purchases are paid 25% in the month of purchase and 75% the following month. At what amount
are June payments for purchases budgeted?
A) $102,500
B) $107,500
C) $110,000
D) $121,250
32) Hatfield Company has the following budgeted credit sales for the last four months of the year-September,
$13,000; October, $19,000; November $20,000; December, $24,000. Experience has shown that payment for the
credit sales is received as follows: 10% in the month of sale, 60% in the first month after sale, 20% in the second
month after sale, and 10% uncollectible. How much cash can Hatfield Company expect to collect in November as a
result of credit sales?
A) $11,400
B) $13,400
C) $14,000
D) $16,000
33) Farmington Enterprises has budgeted sales for the months of September and October at $300,000 and $280,000,
respectively. Monthly sales are 80% credit and 20% cash. Of the credit sales, 50% are collected in the month of sale
and 50% are collected in the following month. What are the October cash collections from customers?
A) $168,000
B) $232,000
C) $288,000
D) $290,000
34) Advance Engineering makes payments on its inventory purchases as follows-30% in the month of purchase,
50% in the following month, and 20% in the second month following purchase. Budgeted inventory purchases for
June, July, and August are $50,000, $43,000 and $56,000, respectively. At what amount are cash payments for
inventory in August budgeted?
A) $40,500
B) $48,300
C) $51,900
D) $56,000