Karim Corporation requires a minimum $9,800 cash balance. Loans taken to meet this requirement cost 1% interest per month (paid at the end of each month). Any preliminary cash balance above $9,800 is used to repay loans at month-end. The cash balance on July 1 is $10,200, and the company has no outstanding loans. Budgeted cash receipts (other than for loans received) and budgeted cash payments (other than for loan or interest payments) follow. Cash receipts Cash payments July $ 25,800 30,700 August $ 33,800 31,800 September $ 41,800 33,800 Prepare a cash budget for July, August, and September. Note: Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar. Beginning cash balance Total cash available Total cash payments Preliminary cash balance Loan activity KARIM CORPORATION Cash Budget July August September $ 10,200 Prov

Karim Corporation requires a minimum $9,800 cash balance. Loans taken to meet this requirement cost 1% interest per month (paid at the end of each month). Any preliminary cash balance above $9,800 is used to repay loans at month-end. The cash balance on July 1 is $10,200, and the company has no outstanding loans. Budgeted cash receipts (other than for loans received) and budgeted cash payments (other than for loan or interest payments) follow. Cash receipts Cash payments July $ 25,800 30,700 August $ 33,800 31,800 September $ 41,800 33,800 Prepare a cash budget for July, August, and September. Note: Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar. Beginning cash balance Total cash available Total cash payments Preliminary cash balance Loan activity KARIM CORPORATION Cash Budget July August September $ 10,200 Prov

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Schedule of cash payments for a service company Horizon Financial Inc. was organized on February 28. Projected selling and administrative expenses for each of the first three months of operations are as follows: March $143,400 April 131,900 May 120,000 Depreciation, insurance, and property taxes represent $30,000 of the estimated monthly expenses. The annual insurance premium was paid on February 28, and property taxes for the year will be paid in June. 63% of the remainder of the expenses are expected to be paid in the month in which they are incurred, with the balance to be paid in the following month. Prepare a schedule of cash payments for selling and administrative expenses for March, April, and May.
The Tomac Swim Club arranged short-term financing of $12,600.00 on July 9 with the Bank of Commerce and secured the loan with a demand note. The club repaid the loan by payments of $5500 on September 7, $3500 on November 5, and the balance on December 30. Interest, calculated on the daily balance and charged to the club's current account on the last day of each month, was at 9% per annum on July 9. The rate was changed to 10% effective September 1 and to 10.5% effective December 1. How much interest was paid on the loan? ..... The total interest paid was S| (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
Medwig Corporation has a DSO of 32 days. The company averages $8,000 in sales each day (all customers take credit). What is the company's average accounts receivable? Assume a 365-day year. Round your answer to the nearest dollar.
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Holiday Tree Farm has a cash balance of $34 and a short-term loan balance of $180 at the beginning of Qt. The net cash inflow for the first quarter is $36 and for the second quarter there is a net cash outflow of $48. All cash shortfalls are funded with short-term debt. The firm pays 2 percent of its prior quarter's ending loan balance as interest each quarter. The minimum cash balance is $20. What is the short-term loan balance at the end of Q2? Multiple Choice $184.3 $179.2 $138.6 $128.4 $1931
Cabanes Factors provides financing to other companies by purchasing their accounts receivable on a non-recourse basis. Cabanes charges a commission to its clients of 15% of all receivables factored. In addition, Cabanes withholds 10% of receivables factored for protection against sales returns or adjustments. Cabanes credits the 10% withheld to Client Retainer and makes payments to clients at the end of each month so that the balance in the retainer is equal to 10% of unpaid receivables at the end of the month. Cabanes recognizes its 15% commissions as revenue at the time the receivables are factored. Also, experience has led Cabanes to establish allowance for bad debts of 4% of all receivables purchased. On January 2, 2021, Cabanes purchased receivables from Cabana Company totaling P3,000,000. Cabana has previously established an allowance for bad debts for these…
Schedule of cash payments for a service company Horizon Financial Inc. was organized on February 28. Projected selling and administrative expenses for each of the first three months of operations are as follows: March April May Depreciation, insurance, and property taxes represent $19,000 of the estimated monthly expenses. The annual insurance premium was paid on February 28, and property taxes for the year will be paid in June. 61% of the remainder of the expenses are expected to be paid in the month in which they are incurred, with the balance to be paid in the following month. $88,600 82,400 75,000 Prepare a schedule of cash payments for selling and administrative expenses for March, April, and May. Horizon Financial Inc. Schedule of Cash Payments for Selling and Administrative Expenses For the Three Months Ending May 31 March April March expenses: Paid in March Paid in April April expenses: Paid in April Paid in May May expenses: Paid in May Total cash payments May
A company has the following excess (deficiency) of cash receipts over cash disbursements projected for the next year on a quarterly basis. It will not have any cash at the start of the year. The quarterly interest rte is 2%, and any borrowing and repayment of principal must be in round $1,000 amounts. There is no cash reserve requirement Assume loan related payments are made when excess cash is available. Quarter 1 2 3 4 Year Excess (deficiency) of cash available for disbursements ($121,140) ($41,680) $177,680 $2,160 $17,020 Required: Prepare a cash budge by quarter for the year. What is the ending cash balance in the fourth quarter if interest is accrued until the end of the fourth quarter and paid at that time along with the total principal borrowed? Please provide detail calculations of how you got the cash available at the beginning. Thank you.
Scotiabank approved a $250,000.00 line of credit for Buhler Industries at prime + 1%. It requires only the repayment of accrued interest on the 24th of each month, which is automatically deducted from the checking account of Buhler Industries. Buhler took out an advance on December 18 for $195,000.00 and made a payment of $160,000.00 on January 16. The prime rate was 6.25% initially and increased to 7.25% on January 5. Complete the repayment schedule below by filling in the payment and principal amounts. Date Balance Annual before Interest Transaction Rate Number of Days Interest Accrued Charged Interest Payment (+) or Advance Principal Amount Balance after Transaction (-) Dec 18 $195,000.00 Dec 24 $195,000.00 7.25% 6/365 $232.40 $232.40 $195,000.00 Jan 5 $195,000.00 7.25% 12/365 $464.79 $464.79 $195,000.00 Jan 16 $195,000.00 8.25% 11/365 $484.83 $949.62 $35,000.00 Jan 24 $35,000.00 8.25% 8/365 $63.29 $1,012.91 $35,000.00
The Tomac Swim Club arranged short-term financing of $13,000.00 on July 19 with the Bank of Commerce and secured the loan with a demand note. The club repaid the loan by payments of $6100 on September 13, $3200 on November 25, and the balance on December 30. Interest, calculated on the daily balance and charged to the club's current account on the last day of each month, was at 6% per annum on July 19. The rate was changed to 6.5% effective September 1 and to 5.5% effective December 1. How much interest was paid on the loan? The total interest paid was S (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
Bulldogs Inc. has a cash conversion cycle of 3 weeks. It has a receivable turnover of 45 and disburse payments to suppliers after 1 week. Determine the normal operating cycle of Bulldogs Inc. if 360-day year is used. (In days, no need to type the word "days")