Juno's Has Projected Its First Quarter Sales at $42,000 and Its

question 60

Multiple Choice

Juno's has projected its first quarter sales at $42,000 and its second quarter sales at $45,000.The firm's cost of goods sold is equal to 70 percent of the next quarter's sales.The accounts receivable period is 30 days and the accounts payable period is 45 days.As of the beginning of the first quarter,the accounts receivable balance is $13,200 and the accounts payable balance is $14,500.The firm pays $1,800 a month in cash expenses and $100 a month in taxes.At the beginning of the first quarter,the cash balance is $380 and the short-term loan balance is zero.The firm maintains a minimum cash balance of $50.Assume each month has 30 days.What is the cumulative cash surplus (deficit) at the end of the first quarter,prior to any short-term borrowing?

• A)-$5,210
• B)-$4,620
• C)-$3,615
• D)$7,880
• E)$9,380

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