Finance Ch 15 Homework

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S Equip is creating a cash budget for the following year and has forecasted expected cash collections over the next five quarters (one year plus first quarter of next year)
Q1Q2Q3Q4Q5
Sales16501950200018002050
Cash collections1650170017501750
At end of Q1 right now.
Purchases are 74% of expected sales next qt
Taxes are 15% of next period's sales
in Q3, Mooney expects to expand one plant which requires additional 1,074 million investment Every quarter, Mooney pays $60 million in int and div pmts to long term debt and equity holders. Mooney prefers to keep a min balance of $15 million at all times. A. What is the next cash inflow in Q3

If Mooney is beginning this year with a cash balance of $37 million and expects to keep a min cash balance of at least $15, what is likely cash balance in Q4? What is the maximum investable funds firm expects next year? What is the target cash deficit firm expects to suffer next year.

Q1Q2Q3Q4
Purchases (.74 S nextQ)1443148013321517

Cash BudgetQ1Q2Q3Q4

Cash Collections1650170017501750

Cash Pmts
Purchases Pmts1443148013321517
Wages Tax Supplie 15% *S next293 300 270 307.5
Expansion 0 01074 0
Int & Div 60 60 60 60
Total pmt1796184027361885

Net Cash Position -146-140-986-135
Beg Cash 37-109-249-1235
Cum Cash -109-249-1235-1370
Target Min 15151515
Surplus or Borrowing-124-264-12501385
Ending Cash 15151515
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