Chinn Company Has Gathered the Following Information

question 8

Essay

Chinn Company has gathered the following information:
March 31, cash balance, $64,000
Amortization expense for April, $13,400
Dividends paid in April, $23,000
Cash collections in April, $142,000
Equipment purchased for cash in April, $27,200
Cash paid for operating expenses in April, $59,600
Merchandise paid for in April, $84,600
Chinn requires a minimum cash balance of $10,000.
Required: Prepare a cash budget for April, and comment on whether or not minimum cash balance requirements are met.

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Definitions:

Distributorship

A business arrangement whereby one entity is granted the right to sell or distribute a manufacturer's products within a specified territory or market.

Antitrust Laws

Legislation enacted to promote competition and restrict monopolistic practices by prohibiting agreements or practices that restrain trade.

Foreign Sovereign Immunities Act

A federal law in the United States that sets limits on the extent to which foreign nations and their related entities can be sued in U.S. courts.

Federal Court Jurisdiction

The authority granted to federal courts to hear and decide cases based on subject matter or parties involved.