Karim Corp. requires a minimum $9,400 cash balance. If
necessary, loans are taken to meet this requirement at a cost of 1%
interest per month (paid monthly). Any excess cash is used to repay
loans at month-end. The cash balance on July 1 is $9,800 and the
company has no outstanding loans. Forecasted cash receipts (other
than for loans received) and forecasted cash payments (other than
for loan or interest payments) follow.
July | August | September | |||||||
Cash receipts | $ | 25,400 | $ | 33,400 | $ | 41,400 | |||
Cash payments | 30,100 | 31,400 | 33,400 | ||||||
Prepare a cash budget for July, August, and September.
(Negative balances and Loan repayment amounts (if any)
should be indicated with minus sign. Round your
final answers to the nearest whole dollar.)
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