Southland Company Is Preparing a Cash Budget for August

question 210

Multiple Choice

Southland Company is preparing a cash budget for August. The company has $17,000 cash at the beginning of August and anticipates $120,800 in cash receipts and $134,500 in cash disbursements during August. Southland Company wants to maintain a minimum cash balance of $10,000.
- To maintain the minimum cash balance of $10,000, the company must borrow:

• A) $27,700.
• B) $6,700.
• C) $7,000.
• D) $0.
• E) $10,000.

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Definitions:

Taft-Hartley Act

A U.S. federal legislation from 1947 that limits the power and actions of trade unions.

First Amendment

A fundamental part of the United States Constitution that protects freedoms concerning religion, expression, assembly, and the right to petition.

Union Contract

A written agreement between an employer and a labor union that outlines the terms of employment, wages, benefits, and working conditions for unionized employees.

Strike

A stoppage of work by employees as a means of enforcing a demand made on their employers.