Short-Term Financial Management Decisions

Vineet you posted a response on March 5 2006 pertaining to short Term Financial Management (see below). One of the questions asked was: will the company need any outside financing?  and the response was as follows:

There is a cash shortfall and a need for outside financing

Could you please expound on this response as I truly don't see where there is a cash shortfall looking at the file in the attachment and why they would need outside financing. Could you also provide a reference for this response. I am in need of having a response by tomorrow evening at 6:00 pm EST. Please help me so that I can have a greater understanding of what is being presented.

Regards
Mark  


Solution by:     Vineet Swarup, MBA,  OTA ID#: 104722
Submitted on:  March 5, 2006, 10:36 am EST  
Business, Finance
Year 2
Short-Term Financial Management Decisions
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Solution
a. Prepare a monthly cash budget for Cyrus Brown Manufacturing for the nine month period, March through November.

Please see the attached file. Depreciation is not to be considered as it is a non cash item

b. Based on your findings in part b, will the company need any outside financing?

There is a cash shortfall and a need for outside financing

Attached file(s):

Cyrus Brown2.xls  View File