$10$

Prime Products hopes to borrow $$87,000$ on April $1$ and repay it plus interest of $$1,220$ on June $30.$ The following data are available for the months April through June, during which the loan will be used:

a$.$ On April $1,$ the start of the loan period, the cash balance will be $$39,000.$ Accounts receivable on April $1$ will total $$170,800,$ of which

$30$

$$146,400$ will be collected during April and $$19,520$ will be collected during May. The remainder will be uncollectible.

b$.$ The company estimates $30\%$ of a month's sales are collected in the month of sale, $60\%$ in the month following sale, and $8\%$ in the second month following sale. The other $2\%$ are bad debts that are never collected. Budgeted sales and expenses for the threemonth period follow:

$\backslash$table$[[,$April,May,June$],[$Sales $($all on account$),$$$242,000,$$$618,000,$$$310,000$