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Kingbird Enterprises had a tough month in May, but June's sales and cash activity are looking strong. Kingbird had to borrow $3,000 in May in order to maintain the company's required minimum balance of $5,000. The loan carries an annual interest rate of 6%, with monthly interest payments required. Loan withdrawals, in $1,000 increments, are assumed to be taken out on the first of the month. Loan payments, also in $1,000 increments, reduce the principal on the last day of the month. The June 1 cash balance is $5,900. With budgeted cash receipts of $109,400 and cash disbursements of $107,300 in June, how much of the prior month's loan would Kingbird be able to pay off in June, if any? What is Kingbird's projected ending cash balance in June? Loan paid off Projected ending cash balance. $

Kingbird Enterprises had a tough month in May, but June's sales and cash activity are looking strong. Kingbird had to borrow $3,000 in May in order to maintain the company's required minimum balance of $5,000. The loan carries an annual interest rate of 6%, with monthly interest payments required. Loan withdrawals, in $1,000 increments, are assumed to be taken out on the first of the month. Loan payments, also in $1,000 increments, reduce the principal on the last day of the month. The June 1 cash balance is $5,900. With budgeted cash receipts of $109,400 and cash disbursements of $107,300 in June, how much of the prior month's loan would Kingbird be able to pay off in June, if any? What is Kingbird's projected ending cash balance in June? Loan paid off Projected ending cash balance. $

FINANCIAL ACCOUNTING
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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Kingbird Enterprises had a tough month in May, but June's sales and cash activity are looking strong. Kingbird had to borrow $3,000 in May in order to maintain the company's required minimum balance of $5,000. The loan carries an annual interest rate of 6%, with monthly interest payments required. Loan withdrawals, in $1,000 increments, are assumed to be taken out on the first of the month. Loan payments, also in $1,000 increments, reduce the principal on the last day of the month. The June 1 cash balance is $5,900. With budgeted cash receipts of $109,400 and cash disbursements of $107,300 in June, how much of the prior month's loan would Kingbird be able to pay off in June, if any? What is Kingbird's projected ending cash balance in June? Loan paid off Projected ending cash balance $
Transcribed Image Text:Kingbird Enterprises had a tough month in May, but June's sales and cash activity are looking strong. Kingbird had to borrow $3,000 in May in order to maintain the company's required minimum balance of $5,000. The loan carries an annual interest rate of 6%, with monthly interest payments required. Loan withdrawals, in $1,000 increments, are assumed to be taken out on the first of the month. Loan payments, also in $1,000 increments, reduce the principal on the last day of the month. The June 1 cash balance is $5,900. With budgeted cash receipts of $109,400 and cash disbursements of $107,300 in June, how much of the prior month's loan would Kingbird be able to pay off in June, if any? What is Kingbird's projected ending cash balance in June? Loan paid off Projected ending cash balance $
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