Reference: 07-14
a Cash Budget by Quarters for the Carney

Reference: 07-14
A cash budget by quarters for the Carney Company is given below (note that some data are missing) . Missing data amounts have been keyed with either question marks or lower case letters (a, b, c, etc.) ; these lower case letters will be referred to in the questions that follow. (It may be necessary to calculate a value for items where a question
mark appears.) The company requires a minimum cash balance of at least $10,000 to start a quarter. All data are in thousands.
Carney Company
Cash Budget $\begin{array}{|l|l|l|l|l|}\hline &{\text { Quarters }} \\\hline &1 & 2 & 3 & 4\\\hline \text { Cash balance, beginning } & \$ 16 & \$ \mathrm{e} & \$ 13 & \$ 10 \\\hline \text { Add collections from customers } & \text { a } & 70 & 67 & 80 \\\hline \text { Total cash available } & ? & ? & 80 & 90 \\\hline \text { Less disbursements: } & & & & \\\hline \text { Purchase of inventory } & 31 & \mathrm{c} & 40 & 35 \\\hline \text { Operating expenses } & 35 & 22 & ? & 15 \\\hline \text { Equipment purchases } & 10 & 14 & 19 & 0 \\\hline \text { Dividends } & 0 & 6 & 0 & 5 \\\hline \text { Total disbursements } & 66 & ? & \mathrm{f} & 55 \\\hline \text { Excess (deficiency) of cash available } & & & & \\\hline \text { over disbursements } & 7 & 17 & (2) & 35 \\\hline \text { Financing: } & & & & \\\hline \text { Borrowings } & \mathrm{b} & - & 12 & - \\\hline \text { Repayments (including interest) } & - & \mathrm{d} & - & (21) \\\hline \text { Total financing } & ? & ? & 12 & (21) \\\hline \text { Cash balance, ending } & \underline{\$ 10} & ? & \$ 10 & \$ 14 \\\hline\end{array}$
-The repayment (including interest) of financing during the second quarter (item d in thousands) is:

A) $0.
B) $7.
C) $17.
D) $4.

Correct Answer:

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