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# Cash overage or shortage

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Company A budgeted the following transactions from March:

Sales (60% collected in month of sales) \$180,000
Cash Operating Expenses \$105,000
Cash purchases of Capital Investments \$50,000
Cash repayment on note payable \$40,000
Depreciation of equipment \$25,000

There was a \$35,000 beginning cash balance. Sales for February were \$75,000 and 40% expected to be collected in the month following the sales. The company desires to have \$20,000 and the cash blance. Determine the amount of cash overage or shortage.

Is it \$42,000 short?
\$23,000 overage?
\$22,000 shortage?
\$43,000 overage?

#### Solution Preview

The cash collection in the month is
February Sales (40% to be collected in March) = 75,000X0.4=30,000
March Sales (60% to be collected in March) = ...

#### Solution Summary

The solution explains how to calculate the amount of cash overage or shortage.

\$2.49