What is the ending cash balance for the first quarter

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A firm has an average collection period of 45 days and an operating cycle of 130 days. It has a policy of keeping at least $10 on hand as a minimum cash balance, and has a beginning cash balance for the first quarter of $20. Beginning receivables for the quarter amount to $35 and beginning accounts payable for the quarter is $25. Sales for the first and second quarters are expected to be $110 and $125, respectively, while purchases of inventories amount to 80% of the next quarter s forecasted sales. The accounts payable period is 90 days. All sales and purchases are made on credit. Also, assume that the sales and purchases are spread out evenly during the quarter. What is the ending cash balance for the first quarter? a. $ 12 b. $ 22 c. $ 85 d. $110 e. None of the above

Reference no: EM131354532

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