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22 August, 17:02

Mosbey Inc. is working on its cash budget for June. The budgeted beginning cash balance is $29,000. Budgeted cash receipts total $187,000 and budgeted cash disbursements total $186,000. The desired ending cash balance is $51,000. The excess (deficiency) of cash available over disbursements for June will be:

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  1. 22 August, 18:15
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    The excess cash available will be $30,000

    Explanation:

    The following information were given:

    beginning cash balance = $29,000

    budgeted cash receipt = $187,000

    budgeted cash disbursement = $186,000

    desired ending cash balance = $51,000

    required = excess (deficiency) of cash available over disbursement.

    To calculate the excess (deficiency) of cash available over disbursement, disbursements will be deducted from all the cash received and available, if the difference is positive, then the cash available is excess, if negative, then the cash available is deficiency. This is calculated as follows

    Total cash available = beginning cash balance + budgeted cash receipt

    = 29,000 + 187,000 = $216,000

    Total disbursements = $186,000

    ∴Excess (deficiency) of cash available = 216,000 - 186,000 = $30,000 (excess)
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