Gale Communications, Inc., is preparing its cash budget for 2012. Gale ended 2011 with cash of $85

Question:

Gale Communications, Inc., is preparing its for 2012. Gale ended 2011 with cash of $85 million, and managers need to keep a cash balance of at least $78 million for operations.
Collections from customers are expected to total $11,335 million during 2012, and payments for the cost of services and products should reach $6,169 million. Operating expense payments are budgeted at $2,553 million.
During 2012, Gale expects to invest $1,822 million in new equipment and sell older assets for $157 million. Debt payments scheduled for 2012 will total $578 million. The company forecasts net income of $893 million for 2012 and plans to pay dividends of $358 million.
Prepare Gale Communications’ for 2012. Will the budgeted level of cash receipts leave Gale with the desired ending cash balance of $78 million, or will the company need additional financing? If so, how much?

Cash Budget
A cash budget is an estimation of the cash flows for a business over a specific period of time. These cash inflows and outflows include revenues collected, expenses paid, and loans receipts and payment. Its primary purpose is to provide the...