Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year Management has prepared the following summary of its budgeted cash flows: Total cash receipts Total cash disbursements '1st Quarter $ 180.000 $260,000 2nd Quarter $ 330.000 $ 230,000 3rd Quarter $ 210.000 $ 220.000 4th Quarter $ 230,000 $ 240,000 The company's beginning cash balance for the upcoming fiscal year will be $20,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded. Required: Prepare the company's cash budget for the upcoming fiscal year. (Repayments, Interest, and cash deficiencles should be Indicated by a minus sign.) Garden Depot Cash Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Beginning cash balance Total cash receipts 20.000 5 10.000 35,800 S 25.800 20.000 180.000 210.000 230,000 950,000 Total cash available 200,000 10.000 245.800 255,800 970,000 Total cash disbursements 260.000 230,000 220.000 240.000 950.000 Excess (deficiency) of cash available over disbursements (60.000) (220,000) 25,800 15.800 Financing Borrowings 70,000 70,000 Repayments Interest Total financing Ending cash balance 0 0 0 70.000 0 རི། 10,000 $ (220,000) $ 25.800 15,800 $ 15.800
Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year Management has prepared the following summary of its budgeted cash flows: Total cash receipts Total cash disbursements '1st Quarter $ 180.000 $260,000 2nd Quarter $ 330.000 $ 230,000 3rd Quarter $ 210.000 $ 220.000 4th Quarter $ 230,000 $ 240,000 The company's beginning cash balance for the upcoming fiscal year will be $20,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded. Required: Prepare the company's cash budget for the upcoming fiscal year. (Repayments, Interest, and cash deficiencles should be Indicated by a minus sign.) Garden Depot Cash Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Beginning cash balance Total cash receipts 20.000 5 10.000 35,800 S 25.800 20.000 180.000 210.000 230,000 950,000 Total cash available 200,000 10.000 245.800 255,800 970,000 Total cash disbursements 260.000 230,000 220.000 240.000 950.000 Excess (deficiency) of cash available over disbursements (60.000) (220,000) 25,800 15.800 Financing Borrowings 70,000 70,000 Repayments Interest Total financing Ending cash balance 0 0 0 70.000 0 རི། 10,000 $ (220,000) $ 25.800 15,800 $ 15.800
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year Management has prepared the following summary
of its budgeted cash flows:
Total cash receipts
Total cash disbursements
'1st Quarter
$ 180.000
$260,000
2nd Quarter
$ 330.000
$ 230,000
3rd Quarter
$ 210.000
$ 220.000
4th Quarter
$ 230,000
$ 240,000
The company's beginning cash balance for the upcoming fiscal year will be $20,000. The company requires a minimum cash balance
of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any
amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments
are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded.
Required:
Prepare the company's cash budget for the upcoming fiscal year. (Repayments, Interest, and cash deficiencles should be Indicated
by a minus sign.)
Garden Depot
Cash Budget
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Year
Beginning cash balance
Total cash receipts
20.000 5
10.000
35,800 S
25.800
20.000
180.000
210.000
230,000
950,000
Total cash available
200,000
10.000
245.800
255,800
970,000
Total cash disbursements
260.000
230,000
220.000
240.000
950.000
Excess (deficiency) of cash available over disbursements
(60.000)
(220,000)
25,800
15.800
Financing
Borrowings
70,000
70,000
Repayments
Interest
Total financing
Ending cash balance
0
0
0
70.000
0
རི།
10,000 $ (220,000) $
25.800
15,800 $ 15.800
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