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Motors Corporation manufactures motors for dirt bikes. The company requires a minimum $30,000 cash balance at each month-end. If necessary, the company borrows to meet this requirement at a cost of 3% interest per month (paid at the end of each month). Any preliminary cash balance above $30,000 at month-end is used to repay loans. The cash balance on July 1 is $35,000, and the company has no outstanding loans. Budgeted cash receipts and budgeted cash payments (other than for interest on the loan and loan activity) follow. July August September $ $ $ 86,000 112,000 151,000 114,000 100,900 128,400 Prepare a cash budget for July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.) Cash receipts Cash payments MOTORS CORPORATION Cash Budget Beginning cash balance Total cash available Total cash payments Preliminary cash balance Additional loan (loan repayment) Ending cash balance Loan activity Loan balance, beginning of Month Additional loan (loan repayment) Loan balance, end of month July $ $ 0 olo 0 0 August September 0 $ $ 0 $ 0 0 OO 0 $ 0 $ 0 $ 0 이이 0 0 0 0 0

Motors Corporation manufactures motors for dirt bikes. The company requires a minimum $30,000 cash balance at each month-end. If necessary, the company borrows to meet this requirement at a cost of 3% interest per month (paid at the end of each month). Any preliminary cash balance above $30,000 at month-end is used to repay loans. The cash balance on July 1 is $35,000, and the company has no outstanding loans. Budgeted cash receipts and budgeted cash payments (other than for interest on the loan and loan activity) follow. July August September $ $ $ 86,000 112,000 151,000 114,000 100,900 128,400 Prepare a cash budget for July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.) Cash receipts Cash payments MOTORS CORPORATION Cash Budget Beginning cash balance Total cash available Total cash payments Preliminary cash balance Additional loan (loan repayment) Ending cash balance Loan activity Loan balance, beginning of Month Additional loan (loan repayment) Loan balance, end of month July $ $ 0 olo 0 0 August September 0 $ $ 0 $ 0 0 OO 0 $ 0 $ 0 $ 0 이이 0 0 0 0 0

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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Motors Corporation manufactures motors for dirt bikes. The company requires a minimum $30,000 cash balance at each month-end. If necessary, the company borrows to meet this requirement at a cost of 3% interest per month (paid at the end of each month). Any preliminary cash balance above $30,000 at month-end is used to repay loans. The cash balance on July 1 is $35,000, and the company has no outstanding loans. Budgeted cash receipts and budgeted cash payments (other than for interest on the loan and loan activity) follow. July August September $ $ $ 86,000 112,000 151,000 114,000 100,900 128,400 Prepare a cash budget for July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.) Cash receipts Cash payments MOTORS CORPORATION Cash Budget Beginning cash balance Total cash available Total cash payments Preliminary cash balance Additional loan (loan repayment) Ending cash balance Loan activity Loan balance, beginning of Month Additional loan (loan repayment) Loan balance, end of month July $ $ 0 0 0 August September 0 $ 0 $ $ 0 0 0 0 $ 0 $ 0 $ 0 0 0 0 0 0
Transcribed Image Text:Motors Corporation manufactures motors for dirt bikes. The company requires a minimum $30,000 cash balance at each month-end. If necessary, the company borrows to meet this requirement at a cost of 3% interest per month (paid at the end of each month). Any preliminary cash balance above $30,000 at month-end is used to repay loans. The cash balance on July 1 is $35,000, and the company has no outstanding loans. Budgeted cash receipts and budgeted cash payments (other than for interest on the loan and loan activity) follow. July August September $ $ $ 86,000 112,000 151,000 114,000 100,900 128,400 Prepare a cash budget for July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.) Cash receipts Cash payments MOTORS CORPORATION Cash Budget Beginning cash balance Total cash available Total cash payments Preliminary cash balance Additional loan (loan repayment) Ending cash balance Loan activity Loan balance, beginning of Month Additional loan (loan repayment) Loan balance, end of month July $ $ 0 0 0 August September 0 $ 0 $ $ 0 0 0 0 $ 0 $ 0 $ 0 0 0 0 0 0
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