Please explain how the interest is calculated and finish.

Karim Corp. requires a minimum $8,400 cash balance. If necessary, loans are taken to meet this requirement at a cost of 1% interest per month (paid monthly). Any excess cash is used to repay loans at month-end. The cash balance on July 1 is $8,800 and the company has no outstanding loans. Forecasted cash receipts (other than for loans received) and forecasted cash payments (other than for loan or interest payments) follow.

	July			August			September
Cash receipts	$	24,400		$	32,400		$	40,400
Cash payments		28,600			30,400			32,400

Prepare a cash budget for July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.)

alcate completion. Return to question Answer is not complete. 20 points KARIM CORP. Cash Budget For July, August, and September July August Beginning cash balance 8,800 $ 8,400 Cash receipts 24,400 32,400 Total cash available 33,200 40,800 Cash payments 28,600 30,400 Interest on bank loan 0 Preliminary cash balance $ 4,600 September $ 8,400 40,400 48,800 32,400 Ending cash balance Loan balance $ 0 Loan balance - Beginning of month Additional loan (loan repayment) Loan balance - End of month