Ned's Co Has an Average Collection Period of 45 Days and and an Operating

question 364

Multiple Choice

Ned's Co. has an average collection period of 45 days and an operating cycle of 130 days. It has a policy of keeping at least $10 on hand as a minimum cash balance, and has a beginning cash balance for the first quarter of $20. Beginning receivables for the quarter amount to $35. Sales for the first and second quarters are expected to be $110 and $125, respectively, while purchases amount to 80% of the next quarter's forecast sales. The accounts payable period is 90 days.

What are cash disbursements for the first quarter?

• A) $76
• B) $88
• C) $92
• D) $100
• E) $110

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Definitions:

Cross-functional Teams

Teams composed of members from different departments or areas of expertise, working together towards a common project goal.

Work Processes

The sequence of steps or tasks that are carried out in order to complete a specific job or produce a specific outcome.

Functional Teams

Groups of individuals who are divided according to their specific roles or functions within an organization, working together towards common objectives.

Organizational Culture

The shared values, beliefs, and norms that influence the way employees think, feel, and behave in an organization.