Accounting

The Volkswagen Group Company is preparing its cash budget for the months of April and May. The firm has established a $200,000 line of credit with its bank at a 12% annual rate of interest on which borrowings for cash deficits must be made in fE10,000 increments. There is no outstanding balance on the line of credit loan on April 1. Principal repayments are to be made in any month in which there is a surplus of cash. Interest is to be paid monthly. If there are no outstanding balances on the loans, Volkswagen Group will invest any cash in excess of its desired end-of-month cash balance in UK E. Treasury bills. Volkswagen Group intends to maintain a minimum balance of f100,000 at the end of each month by either borrowing for deficits below the minimum balance or investing any excess cash. Monthly collection and :disbursement patterns are expected to be Collections. 50% of the current month's sales budget and 50% of the previous month's sales . .budget Accounts Payable Disbursements. 75% of the current month's accounts payable budget and . 25% of the previous month's accounts payable budget All other disbursements occur in the month in which they are budgeted . Budget Information May April March (100,000 E50,000 40,000 Sales 40,000 40,00030,000 Accounts payable 50,000 70,00060,000 Payroll 10,000 30,000 25,000 Other disbursements * Q: In April, Raymar's budget will result in40,000 40,000 30,000 50,000 70,000 60,000 Payroll 10,000 30,000 25,000 Other disbursements * Q: In April, Raymar's budget will result in (abai 3) .in excess cash $45,000 O A need to borrow $50,000 on its line of credit A need to borrow $100,000 on its line of credit A need to borrow $90,000 on its line of credit WWI alogically will whey las us addyjus we Microsoft .