Determining Cash Balances Murphy Corporation will be needing a substantial amount of cash to pay off a note receivable that is maturing early in 2001. On December 31, 2000, the controller of Murphy Corporation made a list of cash balances and expected cash flows and has asked you for assistance in computing the amount to be reported as cash in the company’s balance sheet at December 31, 2000. The following items were listed:

The president of Murphy Corporation had promised the board of directors that the company would have at least $240,000 of cash on hand by the end of 2000.

a. Determine the balance of cash and cash equivalents that Murphy Corporation should report in its balance sheet at December 31, 2000.

b. Did the president reach the goal?

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Cash in Neighborhood Bank $203,000 Certificate of deposit maturing Jan. 21, 2001 65,000 Balance in savings account at Local Savings & Loan 27,000 Rent payment to be received Jan. 4, 2001 10,000 Checks received Dec. 28, 2000, and deposited in Neighborhood Bank on Jan. 2, 2001 31,000 Notification from Neighborhood Bank received on Jan. 3, 2001, that payment on a note receivable from a customer had been received and deposited in account on Dec. 29, 2000 Investment in U.S. Treasury bills maturing Jan. 2, 2001 18,000 40,000