Lois Bragg owns a small restaurant in Boston. Ms$.$ Bragg provided her accountant with

the following summary information regarding expectations for the month of June. The

balance in accounts receivable as of May $31$ is $$57,000.$ Budgeted cash and credit sales

for June are $$145,000$ and $$586,000,$ respectively. Credit sales are made through Visa

and MasterCard and are collected rapidly. Seventy percent of credit sales is collected in

the month of sale, and the remainder is collected in the following month. Ms$.$ Bragg's

suppliers do not extend credit. Consequently, she pays suppliers on the last day of the

month. Cash payments for June are expected to be $$719,000.$ Ms$.$ Bragg has a line of

credit that enables the restaurant to borrow funds on demand; however, they must be

borrowed on the last day of the month. Interest is paid in cash also on the last day of the

month. Ms$.$ Bragg desires to maintain a $$33,000$ cash balance before the interest

payment. Her annual interest rate is $8$ percent.

Required

a$.$ Compute the amount of funds Ms$.$ Bragg needs to borrow for June.

b$.$ Determine the amount of interest expense the restaurant will report on the June pro

forma income statement.

c$.$ What amount will the restaurant report as interest expense on the July pro forma

income statement?

Note: Round your answers to $2$ decimal places. Leave no cells blank.

Answer is complete but not entirely correct.