ine company maintains a minumum casn baiance of soy,uvu. All borrowng is oone at tne beg$$nning of a montn; any repayments are

made at the end of a month.

The company has an agreement with a bank that allows the company to borrow in increments of $$1,000$ at the beginning of each

month. The interest rate on these loans is $1\%$ per month and for simplicity we will assume that interest is not compounded. At the end

of the quarter, the company would pay the bank all of the accumulated interest on the loan and as much of the loan as possible $($in

increments of $$1,000),$ while still retaining at least $$59,000$ in cash.

Required:

Prepare a master budget for the three$-$month period ending June $30.$ Include the following detailed schedules:

a$.$ A sales budget, by month and in total.

b$.$ A schedule of expected cash

A cash budget. Show the budget by month and in total. Determine any borrowing that would be needed to maintain the minimum

cash balance of $$59,000$

A budgeted income statement for the three$-$month period ending June $30.$ Use the contribution approach

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