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KARIM CORP. Cash Budget For July, August, and September July August September Beginning cash balance $8,600...

KARIM CORP.
Cash Budget
For July, August, and September
July August September
Beginning cash balance $8,600
Total cash available
Preliminary cash balance
Ending cash balance
Loan balance
Loan balance - Beginning of month $0
Additional loan (loan repayment)
Loan balance - End of month

Karim Corp. requires a minimum $8,200 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 $8,600 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 $ 24,200 $ 32,200 $ 40,200

Cash payments

28,300

30,200

32,200
Business   Accounting   
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Answer #1
KARIM CORP.
Cash Budget
For July, August, and September
July August September
Beginning cash balance 8600 8200 8200
Cash receipts 24200 32200 40200
Total cash available 32800 40400 48400
Cash payments 28300 30200 32200
Interest on bank loan 0 37 17
Preliminary cash balance 4500 10163 16183
Additional loan (loan repayment) 3700 -1963 -1737
Ending cash balance 8200 8200 14446
Loan balance
Loan balance - Beginning of month 0 3700 1737
Additional loan (loan repayment) 3700 -1963 -1737
Loan balance - End of month 3700 1737 0
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