Juno's Has Projected Its Q1 Sales at $46,000 and Its

question 35

Multiple Choice

Juno's has projected its Q1 sales at $46,000 and its Q2 sales at $48,000.Purchases equal 71 percent of the next quarter's sales.The accounts receivable period is 30 days and the accounts payable period is 45 days.At the beginning of Q1, the accounts receivable balance is $12,200 and the accounts payable balance is $14,800.The firm pays $1,500 a month in cash expenses and $400 a month in taxes.At the beginning Q1, the cash balance is $280 and the short-term loan balance is zero.The firm maintains a minimum cash balance of $250.Assume each month has 30 days.What is the cumulative cash surplus (deficit) at the end of the Q1, prior to any short-term borrowing?

• A)$9,210
• B)$9,684
• C)$8,633
• D)$8,880
• E)$9,157

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