A construction company has the following for March: Beginning cash $45,000, Cash receipts $125,000, Cash disbursements $98,000, Minimum cash requirement $25,000. What is the projected cash surplus or deficit?
Correct Answer
A) $47,000 surplus
Ending cash = Beginning cash + Receipts - Disbursements = $45,000 + $125,000 - $98,000 = $72,000. Surplus = $72,000 - $25,000 minimum requirement = $47,000 surplus.
Why This Is the Correct Answer
Ending cash = Beginning cash + Receipts - Disbursements = $45,000 + $125,000 - $98,000 = $72,000. Surplus = $72,000 - $25,000 minimum requirement = $47,000 surplus.
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