Question
Newman Medical Clinic has budgeted the following cash flows. ----------------------January February March Cash receipts $120,000$116,000$136,000 Cash payments For inventory purchases110,00082,00095,000 For S&A expenses31,00032,00027,000 Newman Medical
Newman Medical Clinic has budgeted the following cash flows.
----------------------January February March
Cash receipts $120,000$116,000$136,000
Cash payments
For inventory purchases110,00082,00095,000
For S&A expenses31,00032,00027,000
Newman Medical had a cash balance of $8,000 on January 1. The company desires to maintain a cash cushion of $5,000. Funds are assumed to be borrowed, in increments of $1,000, and repaid on the last day of each month; the interest rate is 1 percent per month. Repayments may be made in any amount available. Newman pays its vendors on the last day of the month also. The company had a monthly$40,000beginning balance in its line of credit liability account from this year's quarterly results.
Required:Prepare a cash budget.(Anyrepayments/shortageshould be indicated with a minus sign.Round your answers to the nearest dollar amount.)
CASH BUDGET ...........JANUARY....... FEBRUARY........MARCH
Beginning cash balance....X.......................X...........................X
Add: Cash Receipt..............X......................X...........................X
Cash Available ..................X......................X...........................X
Less: Cash Payments
For Inv Purchases ...............X.......................X..........................X
For S&A expenses...............X......................X............................X
Total budgeted payments...X.......................X............................X
Payments minus receipts
WORD.......................................X.......................X...........................X
Financing Activity
WORD.....................................X.......................X...........................X
Ending Cash balance....... $ X...................$X..........................$X
I NEED ALL X's filled in..... and choices for the boxes on the left under the wording where I wrote WORD, choices for those are as follows: surplus (shortage), borrowing (repayment) or interest expense per month... not sure what goes where but was able to figure out where the rest belonged which you can see right there....
ALSO for beginning bal under Jan I'm sure 8000 goes there... and for ADD:CASH RECEIPT and info from CASH PAYMENTS I'm sure you put those in for those X's but just wanted to make sure that was right before I did that and confused you .. PLEASE SHOW WORK SO I CAN UNDERSTAND THIS !!
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