[Given the following information, construct the firm's cash budget for the given months.]

1. Sales start in January, and 80 percent of sales are for credit. Collections occur after thirty days.
2. A $10,000 Treasury bill matures in April
3. Monthly fixed disbursements are $15,000.
4. Variable disbursements are 60 percent of sales and
5. are paid in the month of the sales.
6. A tax payment of $20,000 is due in February.
7. The initial cash position is $20,000.
8. The minimum required cash balance is $5,000.
9. Variable cash disbursements are given for April

January February March April

Sales $100,000 60,000 80,000 100,000

Cash sales

Collections

Other receipts

Total cash

receipts

Variable

disbursements

Fixed

disbursements

Other

disbursements

Total cash

disbursements

Net change

during the month

Beginning cash

Ending cash

Required cash

Excess cash

to invest

Cash borrowed

________________________________________________________________________________

What the maximum amount the firm must borrow?

By how much does the amount borrowed or invested change during March?

Why is depreciation excluded from the above analysis?