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Assume a merchandising company provides the following information from its master budget for the month of May: Cash balance, May 1 $ 20,000 Cash collections
Assume a merchandising company provides the following information from its master budget for the month of May:
Cash balance, May 1 | $ | 20,000 | |
Cash collections from customers | $ | 80,000 | |
Cash disbursements for merchandise purchases | $ | 35,000 | |
Cash disbursements for selling and administrative expenses | $ | 40,000 | |
Depreciation included in the selling and administrative expense budget | $ | 5,000 | |
If the company wishes to maintain a minimum cash balance of $30,000 at the end of every month, then its borrowings at the beginning of May will equal?
Multiple Choice
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$5,000
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$0
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$10,000
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$20,000
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