Piano Man, Inc., has a 30-day average collection period and wants to maintain a
ID: 2726702 • Letter: P
Question
Piano Man, Inc., has a 30-day average collection period and wants to maintain a minimum cash balance of $20 million, which is what the company currently has on hand. The company currently has a receivables balance of $199 million and has developed the following sales and cash disbursement budgets in millions: Complete the following cash budget for the company. (Do not round intermediate calculations. Negative amounts should be indicated by a minus sign. Enter your answers in millions of dollars. Round your answers to the nearest whole million dollar amount (e.g., 32).Explanation / Answer
Q2
156
540
516
180
516
26
148
26
Q1Q2
Q3 Q4 Beginning receivables 199156
180 207 Sales 468540
621 585 Cash collection 511516
593 597 Ending receivable 156180
207 195 Total cash collection 511516
593 597 Total cash disbursement 383 490 754 478 Net cash inflow 12826
-161 119 Beginning cash balance 20148
174 13 Net cash inflow 12826
-161 119 Ending cash balance 148 174 13 132 Minimum cash balance -20 -20 -20 -20 Cumulative surplus(deficit) 128 154 -7 112