Question

Pavone Corp. has prepared a preliminary cash budget for the third quarter as shown​ below:

Cash Budget	Jul	Aug	Sep
Beginning cash balance	​$34,000	​$15,000	​$18,500
​Plus: Cash collections	​$56,000	​$52,000	​47,000
Cash available	​90,000	​$67,000	​$65,500
​Less: Cash​ payments:
Purchases of direct materials	​35,000	​9,000	​11,000
Operating expenses	​40,000	​30,500	​30,800
Capital expenditures	0	​9,000	​7,400
Ending cash balance	​$15,000	​$18,500	​$16,300

​Subsequently, the marketing department revised its figures for cash collections. New data are as​ follows: $53,000 in​ July, $56,000 in​ August, and​ $43,000 in September. Based on the new​ data, calculate the new projected cash balance at the end of September.

A.

​$16,300

B.

​$19,500

C.

​$13,300

D.

​$12,000

Answer 1