CASH$-$BUDGET

$(2)$ Cash Disbursements:

$(3)$ Cash Flow:

$(=$ Receipts$-$Disbursents$)(7,250),(39,100),(29,160),(20,100),(10,100),18,700$

The Financing Needed is the amount of financing required to raise'the firm's ending cash balance to

the $$10,000$ desired cash balance. A positive figure for Financing Needed means the firm has

excess cash that can retire prior short$-$term borrowing or be used for investing; in this example, the

excess cash in June repaid borrowing.

$**$ This figure results in accrued interest $($interest obligated for the month of June but not yet paid$)$ of

$$799.$ Purchases and Payments:

$*$These numbers are based on forecast sales of $$80,000$ for July and $$75,000$ for August. Cash Receipts from Sales:

Collections of December Sales:

At the end of June, the firm will have accounts receivable of $(\mathrm{.}20)(100,000)$ from April, $(\mathrm{.}70)(110,000)$ from May, and $100,000$ from June

for a total of $$197,000.$You currently collect your credit sales in the following pattern: $30\%$ one month after the sale, $50\%$ two months after the sale, and $20\%$ three months after the sale. You have determined that if you offer a $2\%$ cash discount, you can get $50\%$ of each month$$s sales to be cash sales. The remainder of the month$$s sales would still be collected in the same existing collection pattern. This cash discount program will begin January $1.$ Compare the interest expense savings over the $6-$month period to the cost of the new policy. Should you offer the discount? All other conditions and assumptions remain the same. To account for the timing impacts, you have to redo the cash budget. Please show excel calculation.