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 $29,000, 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. Cash receipts Cash payments July $80,000 108,000 August $ 106,000 94,900 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) Beginning cash balance Add Cash receipts Total cash available Less Cash payments for Interest on loan All items excluding interest Total cash payments Preliminary cash balance Additional loan (loan repayment) Ending cash balance Loan activity September $ 145,000 122,400 MOTORS CORPORATION Cash Budget Loan balance, beginning of Month Additional loan (loan repayment) Loan balance, end of month July $ 29,000 80,000 100,000 0 108,000 108,000 1,000 August September $ 1,000 $ 0$ 0 $ 0 0 0 0 $ 0 S 0 0 0 0

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter17: The Management Of Cash And Marketable Securities

Section: Chapter Questions

Problem 10P

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I have some of it done already. Just need the other squares. If you could show the work out for how you get the math done would be appreciated

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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 $29,000, 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.
Cash receipts
Cash payments
July
$ 80,000
108,000
August
$ 106,000
94,900
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.)
Beginning cash balance
Add Cash receipts
Total cash available
Less Cash payments for
Interest on loan
All items excluding interest
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
MOTORS CORPORATION
Cash Budget
September
$ 145,000
122,400
July
$ 29,000
80,000
100,000
$
$
S
0
108,000
108,000
1,000
August September
1,000 $
0 $
0 $
0
0
0
0$
0$
05
0
0
0
0

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