The Lowville Company has budgeted the following data for November: • Sales of $1,728,300, all in cash. • A cash balance on November 1 of $72,000. • Cash disbursements (other than interest) during November of $1,740,000. • A minimum cash balance of $90,000 at the end of each month. The company has 2% open line of credit for $100,000. All borrowing will take place at the beginning of the month. The November interest will be paid in cash when repayment is made. The excess (deficiency) of cash available over disbursements for November will be: A. $(11,700) B. $ (29,700) C. $60,300 D. $72,000 1. 2. The amount of cash needed to be borrowed on November 1 to cover all cash disbursements and to obtain the desired November 30 cash balance is: A. $11,700 B. $18,000 C. $29,700 D. $30,000 The minimum cash balance the Lowville Company should have in order to make both repayment and interest payment in December should be closest to: A. $18,060 B. $29,800 C. $90,600 D. $119,800

The Lowville Company has budgeted the following data for November: • Sales of $1,728,300, all in cash. • A cash balance on November 1 of $72,000. • Cash disbursements (other than interest) during November of $1,740,000. • A minimum cash balance of $90,000 at the end of each month. The company has 2% open line of credit for $100,000. All borrowing will take place at the beginning of the month. The November interest will be paid in cash when repayment is made. The excess (deficiency) of cash available over disbursements for November will be: A. $(11,700) B. $ (29,700) C. $60,300 D. $72,000 1. 2. The amount of cash needed to be borrowed on November 1 to cover all cash disbursements and to obtain the desired November 30 cash balance is: A. $11,700 B. $18,000 C. $29,700 D. $30,000 The minimum cash balance the Lowville Company should have in order to make both repayment and interest payment in December should be closest to: A. $18,060 B. $29,800 C. $90,600 D. $119,800

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

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 Receipts $528,000 409, 000 452,000 Cash payments $470,400 January February 351,400 March 534,000 According to a credit agreement with its bank, Kayak requires a minimum cash balance of $40,000 at each month-end. In return, the bank has agreed that the company can borrow up to $150,000 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 loan principal with any cash in excess of $40,000 on the last day of each month. The company has a cash balance of $40,000 and a loan balance of $80,000 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…
Don't give answer in image format
Maraa Company's budget includes the following credit sales for the current year: August, $25,000; September, $36,000; October, $30,000; November, $32,000. Experience has shown that payment for the credit sales is received as follows: 15% in the month of sale, 60% in the first month after sale, 20% in the second month after sale, and 5% is uncollectible. How much cash can Marra expect to collect in October as a result of current and past credit sales? Group of answer choices 1)$19,700. 2)$30,000. 3)$31,100. 4)$28,500. 5)$33,900.
Vinubhai
please give me answer in excel.
Kayak Company budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for lo principal and interest payments) for the first three months of next year. January February March Cash Receipts Cash payments $518,000 $ 461,500 352,000 523,000 408,500 464,000 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. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) Beginning cash balance Add: Cash receipts Total cash available Less: Cash payments for All items excluding…
The following is the sales budget for Yellowhead Inc. for the first quarter of 2021: Sales January $200,000 February $220,000 March $243,000 Credit sales are collected as follows: 65% in the month of the sale, 20% in the month after the sale, and 15% in the second month after the sale. The accounts receivable balance at the end of the previous quarter was $84,000 ($54,000 of which was uncollected December sales). a. Calculate the sales for November. (Omit "$" sign in your response.) November sales b. Calculate the sales for December. (Round the final answer to 2 decimal places. Omit "$" sign in your response.) December sales $ c. Calculate the cash collections from sales for each month from January through March. (Do not round intermediate calculations. Round the final answers to 2 decimal places. Omit "$" sign in your response.) January February March Cash collections $ $ $
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.
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…
Garden Depot is a retailer that provided the following budgeted cash flows for next year: 3rd Quarter $ 220,000 $ 227,000 Total cash receipts Total cash disbursements 1st Quarter 2nd Quarter $ 190,000 $ 340,000 $ 267,000 $ 237,000 The company's beginning cash balance for next year will be $22,000. The company requires a minimum cash balance of $10,000 and may borrow money at the beginning of any quarter and may repay any part of its loans at the end of any quarter. Interest payments, based on a quarterly interest rate of 3%, are due on any principal at the time it is repaid. For simplicity, assume interest is not compounded. Required: Prepare the company's cash budget for next year. Note: Repayments, interest, and cash deficiencies should be indicated by a minus sign. Beginning cash balance Total cash receipts Total cash available Total cash disbursements Excess (deficiency) of cash available over disbursements Financing: Borrowings Repayments Interest Total financing Ending cash…