Directions: Complete this Cash Budget given the following rules: 1. The interest

Question

Directions: Complete this Cash Budget given the following rules: 1. The interest will be calculated as 1 1% per year 2. The 3. Borrowing and re ending cash balance needs to be $15,000 after paying interest. rowing and repayment needs to be in multiples of S Cash Budget Dec Nov Oct Beginning Cash Balance Add Cash Receipts Cash Available 20,500 114,000 116,000 81,000 Less Payments For Inventory Purchases For S&A; Expenses Purchase of Store Fixtures 38,000 62,000 23,000 50,000 135,000 56,950 30,100 22,200 4,000 30,000 91,050 Total Budgeted Payments 90,200 Surplus/(Shortage) Financing Activity Borrowing Interest Expense Repayment Ending Cash Balance

Explanation / Answer

October November December Total Beginning cash balance 20500 15050.833 15551.6667 20500 Add: Cash receipts 81000 114000 116000 311000 Cash available 101500 129050.83 131551.667 331500 Less Payments: For inventory purchases 62000 56950 38000 156950 For S&A expenses 23000 30100 22200 75300 Purchase of store fixtures 50000 4000 30000 84000 Total Budgeted Payments 135000 91050 90200 316250 Surplus/(Shoratage) -33500 38001 41352 15250 Financing Activity: Borrowing 49000 0 0 49000 Interest Expense 449 449 248 1146 Repayments 0 22000 0 22000 Total financing 48551 -22449 -248 25854 Ending cash balance 15051 15552 41104 41104 Notes: Borrowings are assumed to have been made at the beginning of each month and repayments/interest are assumed to be made at the end of the month.

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