E9-32A (similar to) Family Medical Supply began October with $10,200 cash. Click

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E9-32A (similar to) Family Medical Supply began October with $10,200 cash. Click the icon to view further information.) Requirement Prepare Family Medical Supply's cash budget for October and November. Prepare the cash budget. (For amounts with a S0 balance, make sure to enter "0" in the appropriate cell. Use parentheses or a minus sign when entering any deficiency) Family Medical Supply Combined Cash Budget For the Months Ended October and November October More Info Beginning cash balance Plus: Cash collections Plus: Collection of note receivable Total cash available Less: Cash payments Management forecasts that collections from credit customers will be $11,500 in October and $15,000 in November. The business is scheduled to receive $6,500 cash on a business note receivable in October Projected cash payments include inventory purchases ($12,200 in October and $16,700 in November) and operating expenses (2,500 each month). Family Medical Supply's bank requires a $11,000 minimum balance in the business checking account. At the end of any month when the account balance dips below $11,000, the bank automatically extends credit to the store in multiples of $2,000. The company borrows as little as possible and pays back loans in quarterly installments of S4000 plus 6% interest on the entire unpaid principal The first payment occurs three months after the loan Purchases of inventory Operating expenses Total payments Ending cash balance before financing Minimum cash balance desired Cash excess (deficiency) Total effect of financing Print Done Ending cash balance Enter any number in the edit fields and then click Check Answer

Explanation / Answer

Combined cash budget October November Total Beginning cash balance 10200 13500 10200 Plus: Cash collections 11500 15000 26500 Plus: Collections from Notes receivable 6500 0 6500 Total cash available 28200 28500 43200 Less: Cas payment Purchase of inventory 12200 16700 28900 Operating expense 2500 2500 5000 Ttal payment 14700 19200 33900 Ending cash balance before financing 13500 9300 9300 Minimum Cash balance req 11000 11000 11000 Cash e excess/ (Deficiency) 2500 -1700 -1700 Total effect of financing 0 1700 1700 Ending cash balance   13500 11000 11000

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