Beverages R$$ Us$,$ Inc. is a merchandiser of$$ soda, primarily Shasta. They are beginning operations on June $1.$ The company expects sales in the first month of operations to total$$ $$6,000,$ all of which are cash sales. Purchases of inventory during the first month of operations is expected to cost$$ $$500.$ Suppliers are hesitant to extend credit to Beverages R$$ Us$,$ as they are a new business with little track record. As$$ such, purchases are paid for in the month of purchase. No purchase discounts are available. Beverages R Us expects monthly operating expenses of$$ $$2,000,$ $$600$ of which relates to Bad Debt Expense. No other timing differences between when cash operating expenses are incurred and when they are paid exist. Beverages R Us currently has no debt$$ obligations, but does expect to pay a cash dividend of$$ $$1,500$ at the end of June.

Beverages R Us is required to maintain a minimum cash balance of$$ $$3,000$ at the end of each month in case of emergencies. How much would Beverages R Us need to borrow in order to maintain the proper ending cash balance assuming no other changes are made to$$ operations?

Question $7$ options:

$$100$

$$600$

$$400$

$$1,000$

No Loan Needed