Construct a cash budget for mario

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Problem - Mario's sales for February, March, and April were as follows: $120,000, $140,000 and $160,000. (Mario began his business in February) 60% of sales are collected in the month of sale, with the remaining 40% collected in the following month.

Mario's expenses include:

 

February

March

April

Operating expense

$52,000

$30,000

$25,000

Cost of goods sold

$20,000

24,000

22,000

Operating expenses and cost of goods sold are paid in the month incurred.

Required:

(A) Construct a cash budget for Mario and tell me how much cash Mario will have at the end of: February, March, and April.

(B) Will Mario have enough money to cover the $55,000 payoff of his mortgage of in April?

Reference no: EM132059751

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