Question
Consider the following third-quarter budget data for TAP & Brothers: TAP & Brothers Third-Quarter Budget Data July August September Credit Sales 255,538 264,664 287,956 Credit
Consider the following third-quarter budget data for TAP & Brothers:
| July | August | September |
Credit Sales | 255,538 | 264,664 | 287,956 |
Credit Purchases | 97,184 | 115,062 | 131,463 |
Wages, Taxes, and Expenses | 26,305 | 31,169 | 33,665 |
Interest | 7,125 | 7,788 | 8,043 |
Equipment Purchases | 54,430 | 61,875 | 0 |
The company predicts that 4% of its credit sales will never be collected, 30% of its sales will be collected in the month of the sale, and the remaining 66% will be collected in the following month. Credit purchases will be paid in the month following the purchase.
- In June, credit sales were $138,803, and credit purchases were $102,722
- Julys beginning cash is $184,421
If TAP maintains a policy of always keeping a minimum cash balance of $75,000 as a buffer against uncertainty and forecasting errors, what is the cash surplus/deficit at the end of the quarter (i.e., end of September)? (Answer surplus as a positive number or deficit as a negative number. Round answer to 0 decimal places. Do not round intermediate calculations)
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