Sebestian, Inc , began operations on January 1 of the current year with a $12,000 cash balance Forty percent of sales are collected in the month of sale 60 are collected in the month following sale Similarly, 20 of purchases are paid in the month of purchase, and 80 are paid in the month following purchase The following data apply to January and February January February Sales $35,000 $55,000 Purchases 30,000 40,000 Operating expenses 7,000 9,000 If operating expenses are paid in the month incurred and include monthly depreciation charges of $2,500, determine the change in Sebestian's cash balance during February A $5,000 increase B $7,500 increase C $8,000 increase D $4,500 increase E $2,000 increase

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Sebestian, Inc., began operations on January 1 of the current year with a $12,000 cash balance. Forty percent of sales are collected in the month

Sebestian, Inc., began operations on January 1 of the current year with a $12,000 cash balance. Forty percent of sales are collected in the month of sale; 60% are collected in the month following sale. Similarly, 20% of purchases are paid in the month of purchase, and 80% are paid in the month following purchase. The following data apply to January and February:

	January	February
Sales	$35,000	$55,000
Purchases	30,000	40,000
Operating expenses	7,000	9,000

If operating expenses are paid in the month incurred and include monthly depreciation charges of $2,500, determine the change in Sebestian's cash balance during February.