Cheyenne Company Has Budgeted the Following Information for June If There Is a Cash Shortage, the Company Borrows Money

question 12

Multiple Choice

Cheyenne Company has budgeted the following information for June: $$\begin{array} { | l | r | } \hline \text { Cash receipts } & \$ 271,000 \\\hline \text { Beginning cash balance } & 5,000 \\\hline \text { Cash payments } & 280,000 \\\hline \text { Desired ending cash balance } & 25,000 \\\hline\end{array}$$ If there is a cash shortage, the company borrows money from the bank. All cash is borrowed at the beginning of the month in $1,000 increments and interest is paid monthly at 1% on the first day of the following month. The company had no debt before June 1^st. The amount of interest paid on July 1 would be:

• A) $250.
• B) $400.
• C) $221.
• D) $290.

Perform and interpret the aging method for estimating the allowance for uncollectible accounts.

Evaluate the financial effects of factoring receivables on a company's balance sheet and income statement.

Compute the cash received from discounting notes receivable and record the transactions properly.

Assess the impact of debt restructuring on the financial statements and calculate related ratios.

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Definitions:

External Factors

Elements outside an individual, such as environmental, social, or economic forces, that can influence thoughts, behaviors, and outcomes.

Bandura's Theory

Refers to Albert Bandura's social learning theory, which posits that people learn from one another via observation, imitation, and modeling.

Self-Regulation

The process by which individuals control their behavior, emotions, and thoughts towards achieving long-term goals.

Self-Monitoring

The process or ability of individuals to regulate their behavior to adapt to different situations or to meet social expectations.