Lim Auto Parts, a family-owned auto parts store, began January with $10,000 cash. Management fe that collections from credit customers will be $11,600 in January and $15,300 in February. The stor scheduled to receive $8,500 cash on a business note receivable in January. Projected cash payme include inventory purchases ($16,700 in January and $13,300 in February) and selling and adminis expenses ($2,900 each month). (Click the icon to view additional information about Lim Auto Parts.) Read the requirements. More info Lim Auto Parts' bank requires a $10,000 minimum balance in the store's checking account. At the end of any month when the account balance falls below $10,000, the bank automatically extends credit to the store in multiples of $1,000. Lim Auto Parts borrows as little as possible and pays back loans in quarterly installments of $2,000, plus 3% APR interest on the entire unpaid principal. The first payment occurs three months after the loan. Requirements -X 4 1. Prepare Lim Auto Parts' cash budget for January and February. 2. How much cash will Lim Auto Parts borrow in February if collections from customers that month total $14,300 instead of $15,300? 100
Lim Auto Parts, a family-owned auto parts store, began January with $10,000 cash. Management fe that collections from credit customers will be $11,600 in January and $15,300 in February. The stor scheduled to receive $8,500 cash on a business note receivable in January. Projected cash payme include inventory purchases ($16,700 in January and $13,300 in February) and selling and adminis expenses ($2,900 each month). (Click the icon to view additional information about Lim Auto Parts.) Read the requirements. More info Lim Auto Parts' bank requires a $10,000 minimum balance in the store's checking account. At the end of any month when the account balance falls below $10,000, the bank automatically extends credit to the store in multiples of $1,000. Lim Auto Parts borrows as little as possible and pays back loans in quarterly installments of $2,000, plus 3% APR interest on the entire unpaid principal. The first payment occurs three months after the loan. Requirements -X 4 1. Prepare Lim Auto Parts' cash budget for January and February. 2. How much cash will Lim Auto Parts borrow in February if collections from customers that month total $14,300 instead of $15,300? 100
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Lim Auto Parts, a family-owned auto parts store, began January with $10,000 cash. Management fo
that collections from credit customers will be $11,600 in January and $15,300 in February. The stor
scheduled to receive $8,500 cash on a business note receivable in January. Projected cash payme
include inventory purchases ($16,700 in January and $13,300 in February) and selling and adminis
expenses ($2,900 each month).
(Click the icon to view additional information about Lim Auto Parts.)
Read the requirements.
More info
Lim Auto Parts' bank requires a $10,000 minimum balance in the store's checking
account. At the end of any month when the account balance falls below $10,000,
the bank automatically extends credit to the store in multiples of $1,000. Lim Auto
Parts borrows as little as possible and pays back loans in quarterly installments of
$2,000, plus 3% APR interest on the entire unpaid principal. The first payment
occurs three months after the loan.
Requirements
4
1. Prepare Lim Auto Parts' cash budget for January and February.
2. How much cash will Lim Auto Parts borrow in February if collections from
customers that month total $14,300 instead of $15,300?
Print
Done
1
1
X
X
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