Donn Communications, Inc., is preparing its cash budget for 2012. Donn ended 2011 with cash of $88

Question:

Donn Communications, Inc., is preparing its for 2012. Donn ended 2011 with cash of $88 million, and managers need to keep a cash balance of at least $79 million for operations.
Collections from customers are expected to total $11,323 million during 2012, and payments for the cost of services and products should reach $6,185 million. Operating expense payments are budgeted at $2,557 million.
During 2012, Donn expects to invest $1,823 million in new equipment and sell older assets for $151 million. Debt payments scheduled for 2012 will total $611 million. The company forecasts net income of $884 million for 2012 and plans to pay dividends of $316 million.
Prepare Donn Communications’ for 2012. Will the budgeted level of cash receipts leave Donn with the desired ending cash balance of $79 million, or will the company need additional financing? If so, how much?

Cash Budget
A cash budget is an estimation of the cash flows for a business over a specific period of time. These cash inflows and outflows include revenues collected, expenses paid, and loans receipts and payment. Its primary purpose is to provide the...