Kayak Co. budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year. Cash Cash January February March Receipts $519,000 407,500 455,000 payments $461,400 349,900 524,000 According to a credit agreement with the company's bank, Kayak promises to have a minimum cash balance of $50,000 at each month-end. In return, the bank has agreed that the company can borrow up to $160,000 at a monthly interest rate of 1%, paid on the last day of each month. The interest is computed based on the beginning balance of the loan for the month. The company repays loa principal with any cash in excess of $50,000 on the last day of each month. The company has a cash balance of $50,000 and a loan balance of $100,000 at January 1. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) KAYAK CCMPANY

Kayak Co. budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year. Cash Cash January February March Receipts $519,000 407,500 455,000 payments $461,400 349,900 524,000 According to a credit agreement with the company's bank, Kayak promises to have a minimum cash balance of $50,000 at each month-end. In return, the bank has agreed that the company can borrow up to $160,000 at a monthly interest rate of 1%, paid on the last day of each month. The interest is computed based on the beginning balance of the loan for the month. The company repays loa principal with any cash in excess of $50,000 on the last day of each month. The company has a cash balance of $50,000 and a loan balance of $100,000 at January 1. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) KAYAK CCMPANY

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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Eastern Enterprises is preparing a cash budget for June. Eastern has $12,000 cash at the beginning of June and anticipates $30,000 in cash receipts and $34,500 in cash disbursements during June. Eastern Enterprises has an agreement with its bank to maintain a cash balance of at least $10,000. As of May 31, Eastern owes $15,000 to the bank. To maintain the $10,000 required balance, during June Eastern must: Group of answer choices: 1)Borrow $10,000. 2)Borrow $ 2,500. 3)Repay $ 2,500. 4)Borrow $ 4,500. 5)Repay $ 7,500.
i do not understand why the loan payment amount is wrong
Shalom Company wants to maintain a minimum monthly cash balance of P20,000. The budget for the first quarter showed an ending cash balance of P21,000. In April, expected cash receipts are P321,000, and budgeted expenses, including depreciation of P30,000, are expected to be P288,000. Amounts must be in whole numbers. Example: 88,000 or (88,000) Should Shalom Company enter into a financing agreement? Yes or No? Use the underlined words in capital letters as your choice.
Karim Corporation requires a minimum $8,800 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 $8,800 is used to repay loans at month-end. The cash balance on July 1 is $9,200, 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 Beginning cash balance Add: Cash receipts Total cash available Less: Cash payments for Interest on loan Interest revenue 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. Total cash payments Preliminary cash balance Loan activity July $ 24,800 29,208 Ending cash balance August $ 32,800 30,800 Loan balance Beginning of month Additional loan (loan repayment) Loan…
Kayak Company budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year. Cash Receipts Cash payments January $ 520,000 $ 463,500 February 401,500 345,000 March 465,000 527,000 Kayak requires a minimum cash balance of $50,000 at each month-end. Loans taken to meet this requirement charge 1%, interest per month, paid at each month-end. The interest is computed based on the beginning balance of the loan for the month. Any preliminary cash balance above $50,000 is used to repay loans at month-end. The company has a cash balance of $50,000 and a loan balance of $100,000 at January 1. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.)
Kayak Company budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year. January February March Cash Receipts 523,000 $ Beginning cash balance Total cash available Kayak requires a minimum cash balance of $40,000 at each month-end. Loans taken to meet this requirement charge 1%, Interest per month, paid at each month-end. The Interest is computed based on the beginning balance of the loan for the month. Any preliminary cash balance above $40,000 is used to repay loans at month-end. The company has a cash balance of $40,000 and a loan balance of $80,000 at January 1. 408,500 476,000 Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) Total cash payments Preliminary cash balance Loan activity Ending cash balance Cash payments $ 469,800…
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An entity is budgeting its cash payments for the last quarter of 2020. All purchases are made on account with 2% discount for early payments. The October purchases is set at P150,000, and purchases increase by 20% based on the previous month. 50% of purchases are paid on the month of purchase, availing of the purchase discount; 45% are paid the next month; and 5% are paid after 2 months from date of purchase. How much is the total cash payment to be made in December 2020?
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Rivers Company purchases merchandise on account. In general, Rivers pays 50% in the month of purchase and 50% in the following month. All payments in the month of purchase qualify for a 2% cash discount. First quarter budgeted purchases are: January $90,000 February $80,000 March $96,000 A. What are the total cash disbursements expected in February? B. What are the total cash disbursements expected in March? C. Now suppose that there is no cash discount for purchases made in the month of purchase. Now what are the total cash disbursements expected in February? In March?
Spartan Industries has budgeted the following information for January Cash Receipts $ 43,400 Beginning Cash Balance $ 16,400 Cash Payments $ 61,400 Desired Ending Cash Balance $ 11,400 If there is not enough cash on hand to meet the desired ending balance, the company borrows money from the bank. All cash is borrowed at the beginning of the month in $1,700 increments. Interest is paid monthly on the first day of the following month. The interest rate is 1 percent per month. The company had no debt before January 1 The shortage or surplus of cash before considering cash borrowed or interest payments in January would be a: Multiple Choice $1,600 shortage $9,800 shortage.