Question

In: Accounting

Alpine Products Company has made the following monthly estimates of cash receipts and cash disbursements when...

Alpine Products Company has made the following monthly estimates of cash receipts and cash disbursements when preparing cash budgets for the next twelve months. Alpine Products has beginning cash on hand of $10,000 and wants to maintain this minimum cash level throughout the next year

Cash Cash

Month Receipts Disbursements

January $100,000 $100,000

February $90,000 $110,000

March $80,000 $110,000

April $100,000 $150,000

May $120,000 $180,000

June $160,000 $180,000

July $200,000 $180,000

August $250,000 $180,000

September $250,000 $150,000

October $200,000 $110,000

November $140,000 $100,000

December $100,000 $100,000

Determine whether the cash need (if any) can be repaid within the next year.

Expert Solution

Answer:-

Alpine Products company
Cash Budget
Months	January	February	March	April	May	June	July	August	September	October	November	December
	$	$	$	$	$	$	$	$	$	$	$	$
Opening cash balance	10000	10000	10000	10000	10000	10000	10000	30000	100000	200000	290000	330000
Add:-Cash Receipts	100000	90000	80000	100000	120000	160000	200000	250000	250000	200000	140000	100000

Total Cash available	110000	100000	90000	110000	130000	170000	210000	280000	350000	400000	430000	430000

Less:-Cash Disbursements	100000	110000	110000	150000	180000	180000	180000	180000	150000	110000	100000	100000

Closing balance	10000	-10000	-20000	-40000	-50000	-10000	30000	100000	200000	290000	330000	330000
Add:- Cash borrowed (needed)	0	10000	30000	50000	60000	20000	0	0	0	0	0	0

Closing cash balance(Minimum)	10000	0	10000	10000	10000	10000	30000	100000	200000	290000	330000	330000

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