Bries Corporation is preparing its cash budget for January. The budgeted beginning cash balance is $19,200. Budgeted cash receipts total $189,000 and budgeted cash disbursements total $190,400. The desired ending cash balance is $31,200. To attain its desired ending cash balance for January, the company should borrow:

$13,400

Explanation:

The movement in cash balance over a period is as a result of receipts and disbursements over the period. This may be expressed mathematically as

Opening balance + receipts - disbursements = closing balance

If the company wants to maintain a desired closing balance, the amount to be borrowed would form part of the receipts

$19,200 + receipts - $190,400 = $31,200

Receipts = $190,400 + $31,200 - $19,200

= $202,400

Given Budgeted cash receipts total $189,000 then amount to be borrowed

= $202,400  - $189,000

= $13,400

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