Prepare cash budget, then revise (Learning Objectives 3, 4)

Battery Power, a family-owned battery store, began October with \(\$ 10,500\) cash. Management forecasts that collections from credit customers will be \(\$ 11,000\) in October and \(\$ 15,000\) in November. The store is scheduled to receive \(\$ 6,000\) cash on a business note receivable in October. Projected cash payments include inventory purchases ( \(\$ 13,000\) in October and \(\$ 13,900\) in November) and operating expenses ( \(\$ 3,000\) each month).

Battery Power's bank requires a \(\$ 10,000\) minimum balance in the store's checking account. At the end of any month when the account balance dips below \(\$ 10,000\), the bank automatically extends credit to the store in multiples of \(\$ 1,000\). Battery Power borrows as little as possible and pays back loans in quarterly installments of \(\$ 2,000\) plus \(4 \%\) interest on the entire unpaid principal. The first payment occurs three months after the loan.

\section*{Requirements}
1. Prepare Battery Power's cash budget for October and November.
2. How much cash will Battery Power borrow in November if collections from customers that month total \(\$ 12,000\) instead of \(\$ 15,000\) ?