1.

2.

Tyler Co. predicts the following unit sales for the next four months: April, 4,000 units; May, 4,800 units; June, 6,800 units; and July, 2,700 units. The company's policy is to maintain finished goods Inventory equal to 30% of the next month's sales. At the end of March, the company had 600 finished units on hand. Prepare a production budget for each of the months of April, May, and June. May June Tyler Co. Production Budget April, May and June April Next month's budgeted sales (units) Ratio of inventory to future sales Budgeted ending inventory (units) Add: Budgeted sales (units) Required units of available production Less: Beginning inventory (units) Units to be produced % % % Karim Corp. requires a minimum $8,300 cash balance. Loans taken to meet this requirement cost 2% Interest per month (paid monthly). Any excess cash is used to repay loans at month-end. The cash balance on July 11s $8,700, and the company has no outstanding loans. Forecasted cash receipts (other than for loans received) and forecasted cash payments (other than for loan or interest payments) follow. Cash receipts Cash payments July August $ 24,300 $32,300 28,450 30,300 September $40,300 32,300 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.) Answer is complete but not entirely correct. KARIM CORP. Cash Budget For July, August, and September July August September Beginning cash balance S 8,700 S 8,300 $ 8,300 Cash receipts 24,300 32,000 40,300 Total cash available 33,000 40,300 48,600 Cash payments 28,450 30,300 32,300 Interest on bank loan 0 75 394,550 Preliminary cash balance S 4,550 S 10,225 S 16,261 Additional loan (loan repayment) 3,750 (1,925) (1,825) Ending cash balance S 8,300 IS 8,300 14,436 Loan balance Loan balance - Beginning of month S 0 S 3,750 $ 1,825 Additional loan (loan repayment) 3,750 (1,925) (1,825) Loan balance - End of month S 3,750 $ 1,825 S x S 0