Answer:
Hurzdan, Inc.
Cash Budget
Beginning balance $20 -$152 -$176 -$383
Cash collection 196 441 513 594
Cash available $216 $289 $337 $211
Cash disbursement 368 465 720 456
Ending balance -152 -176 -383 -245
Minimum cash balance 20 20 20 20
Cash requirement $172 $196 $403 $265
Explanation:
a) Data and Calculations:
Average collection period = 30 days
Required minimum cash balance = $20 million
Cash, beginning balance = $20 million
Accounts receivable, beginning balance = $196 million
(in millions): Q1 Q2 Q3 Q4
Sales revenue $441 $513 $594 $558
Cash collection $196 $441 $513 $594
Cash disbursement 368 465 720 456
