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Cash Budget - Renson Corporation

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Renson Corporation, a wholesaler, provided the following information:

Month Merchandise Purchases Sales
January $142,000 $172,000
February 148,000 166,000
March 136,000 165,000
April 154,000 178,000
May 160,000 166,000

Customers pay 60% of their balances in the month of sale, 30% in the month following sale, and 10% in the second month following sale. The company pays all invoices in the month following purchase and takes advantage of a 3% discount on all amounts due. Cash payments for operating expenses in May will be $119,500; Renson's cash balance on May 1 was $127,800.

Required: Determine the following:
A. Expected cash collections during May.
B. Expected cash disbursements during May.
C. Expected cash balance on May 31.

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Solution Summary

The solution provides cash budget for Renson Corporation in excel.

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