(Learning Objective 3: Preparing and using a cash budget) Dan Davis, the chief fi nancial offi cer, is responsible for The Furniture Mart’s cash budget for 20X6. The budget will help Davis determine the amount of long-term borrowing needed to end the year with a cash balance of $130,000. Davis’s assistants have assembled budget data for 20X6, which the computer printed in alphabetical order. Not all the data items reproduced below are used in preparing the cash budget.

❙ Requirements 1. Prepare the cash budget of The Furniture Mart, Inc.

2. Compute The Furniture Mart’s budgeted current ratio at December 31, 20X6. Based on the current ratio and on the cash budget, would you lend $100,000 to The Furniture Mart? Give the reason for your decision.