A CA contractor expects $72,000 of cash receipts in July and $58,500 of cash disbursements. If beginning cash is $14,000, what ending cash is projected?
Correct Answer
A) $27,500.
Ending cash equals beginning cash plus receipts minus disbursements: $14,000 + $72,000 - $58,500 = $27,500.
Why This Is the Correct Answer
Ending cash equals beginning cash plus receipts minus disbursements: $14,000 + $72,000 - $58,500 = $27,500.
Why the Other Options Are Wrong
Option B: $13,500.
$13,500. is below the supported result for cash-flow forecast; it likely uses the wrong base, period, or account bucket.
Option C: $44,500.
$44,500. is above the supported result for cash-flow forecast; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $130,500.
$130,500. is above the supported result for cash-flow forecast; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Preparing Monthly money test: bucket before math for cash-flow forecast.
Reference Hint
Study anchor (closed-book): memorize Cash-flow forecast from CSLB Law and Business Study Guide; CSLB 2026 Law Book / CSLB Law and Business Study Guide Business Finances; know the rule or calculation trigger without relying on exam-room lookup.
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