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Preparing a Prospective Statement of Cash Flows Jane and Harvey Wentland have decided to open a retail athletic supply store, Fitness Outfitters Inc. They will stock clothing, shoes, and supplies used in running, swimming, bicycling, weight lifting, and other exercise and athletic activities. During their first year of operations, 2019, they expect the following results. (Subsequent years are expected to be more successful.) By the end of 2019, Fitness Outfitters needs to have a cash balance of $5,000 and is expected to have the following partial balance sheet: Assume that all sales will be for cash and that equipment will be acquired for cash. In the statement that you prepared for Requirement 1, by how much does the prospective cash balance exceed or fall short of the desired cash balance? If a shortfall occurs, where would you suggest that Jane and Harvey seek additional cash?

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Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
Publisher: Cengage Learning
ISBN: 9781337690881
BuyFind

Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
Publisher: Cengage Learning
ISBN: 9781337690881

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Chapter
Section
Chapter 11, Problem 62.2C
Textbook Problem

Preparing a Prospective Statement of Cash Flows

Jane and Harvey Wentland have decided to open a retail athletic supply store, Fitness Outfitters Inc. They will stock clothing, shoes, and supplies used in running, swimming, bicycling, weight lifting, and other exercise and athletic activities. During their first year of operations, 2019, they expect the following results. (Subsequent years are expected to be more successful.)

Chapter 11, Problem 62.2C, Preparing a Prospective Statement of Cash Flows Jane and Harvey Wentland have decided to open a , example  1

By the end of 2019, Fitness Outfitters needs to have a cash balance of $5,000 and is expected to have the following partial balance sheet:

Chapter 11, Problem 62.2C, Preparing a Prospective Statement of Cash Flows Jane and Harvey Wentland have decided to open a , example  2

Assume that all sales will be for cash and that equipment will be acquired for cash.

In the statement that you prepared for Requirement 1, by how much does the prospective cash balance exceed or fall short of the desired cash balance? If a shortfall occurs, where would you suggest that Jane and Harvey seek additional cash?

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Chapter 11 Solutions

Cornerstones of Financial Accounting
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