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90 Learning objective: Students will learn how to make a cash budget In Excel through this assignment Requirements: Please use the data from the following table to complete the cash budget in Excel spreadsheets. You can use the Excel template (FINA 3562 Project 2 data.xlsx) posted on Blackboard for this assignment. To complete the cash budget, you will have to work on the schedules of expected cash collections and payments first. Please set formulae by referencing to the data in Excel spreadsheets. If you do not meet this requirement, you will be asked to re-work on the project. This project accounts for 6% of your overall grade. Due date: March 19th, 11:59 pm on Blackboard The following table lists the data from the budget of Lewellen Products. 35% the company's sales will be collected in the month of the sale; the other 65% will be collected in the following month. The company pays all its credit purchase with a one-month delay. Credit purchases in June were $206,300, and total sales in June were $419,000 Lewellen Products Sales, purchase, and other budgets June July August September Total sales $419,000 $485,000 $510,000 $565,000 Purchases of material For cash 135,000 95,000 103,000 278,300 For credit 206,300 210,800 296,700 Selling and admin, expenses 42,700 56,500 63,800 Income taxes 20,000 20,000 20,000 Dividends 15,000 15,000 15,000 Equipment purchase 108,000 83,800 We make these assumptions to simplify the analysis: Lewellen Products has an open line of credit with its bank, which can be used as needed to bolster the cash position The company desires to maintain a $70,000 minimum cash balance at the end of each month Therefore, borrowing must be sufficient to cover the cash shortfall and to provide for the minimum cash balance of $70,000. The beginning cash balance for July is $100,000 * All borrowings and repayments must be in multiples of $1,000 amounts, and interest is 3 percent per annum 2 / 2 90% . I * Interest is computed and paid on the principal during the borrowing period. * All borrowings take place at the beginning of a month, and all repayments are made at the end of a month. The company will take a loan at the beginning of July, repay some portion of the loan at the end of August, and should be able to pay off the remaining balance of the loan at the end of September. You have to figure out the amount of loan taken at the beginning of July. * The company pays the selling and administrative expenses, income taxes, dividends, and pays for equipment purchase at the end of a month. Please refer to the example of cash budget in chapter 6 Excel file posted on Blackboard. The interest payment made at the end of August or September is computed as: Principal of the loan x Interest rate on the loan x borrowing period. Because the interest rate on the loan is an annual rate, the borrowing period will be adjusted to a fraction of a year Please also review pages 8-9 of the class notes for how to back out the borrowing amount or repayment of the loan. Compute the interest payment first, and then figure out the repayment of the loan for August or September Home Insert Draw Page Layout Formulas Dala Review View Tell me Calibri (Body) 11 > Wed Text Paste Merge & Center G26 Cash balance, ending (la) (b) + (d)] E 1 B C Lewellen Products Sales, purchase, and other budgets June July 419,000 485,000 August 510,000 September 565,000 206,300 135,000 210,800 42,700 20,000 15,000 108,000 103,000 278,300 56,500 20,000 15,000 83,800+ 95,000 296,700 63,800 20,000 15,000 0 Schedule of Expected Cash Collections July August September 2 3 4 Total sales 5 Purchases of material 6 For cash 7 For credit 8 Selling and admin. expenses 9 income taxes 10 Dividends 11 Equipment purchase 12 13 14 15 16 17 Accounts receivable, 6/30/2020 18 July sales (S485,000) 19 August sales ($510,000) 20 September sales (5565,000) 21 Total cash collections 22 23 24 25 26 27 Accounts payable, 6/30/2020 28 July purchases 29 August purchases 30 September purchases 31 Total cash disbursement 32 Schedule of Expected Cash Payments July August September Sheet1 Sheet2 Shoot3 + L Share heral insolu E IN Zovor Conditional Format Cell Formatting as Table Styles Delete El Format Sort & Filter Find & Select Analyze Data G . Lewellen Products Cash Budget For the Month Ended September 30, 2020 Month July August September $100,000 Cash balance, beginning Add: Receipts: Collections from customers Total cash available (a) Less: Disbursements: Direct materials Selling and admin Equipment purchase Dividends Income tax Total disbursements (b) Minimum cash balance Total cash needed (c) Cash surplus (deficit) (a) - Id Finance: Borrowing Repayment Interest Total effect of financing Id) Cash balance, ending fah-b) + (d))