Calculate the expected cash balance at the end

Reference no: EM13136731

Alpha Corp. has the following sales forecasts for the selected three-month period in the current year:
Month Sales
April $10,000
May 9,000
June 11,000

Sixty percent of sales are collected in the month of the sale, and the remaining balance is collected in the following month.
Accounts Receivable balance (April 1) $11,000
Cash balance (April 1) 4,000

Minimum cash balance is $2,500. Cash can be borrowed in $1,000 increments from the local bank (assume no interest charges). Calculate the expected cash balance at the end of April, assuming that cash is received only from customers and that $15,000 is paid out during April?

Reference no: EM13136731

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