The company would like to maintain the minimum cash balance, as stated above. How much would the company need to borrow if they want to maintain the minimum cash balance (target balance) each month? How much surplus would they have over the minimum cash balance each month? (Don't assume they will borrow. We only want to calculate how much they would need to borrow, or how much of a surplus they would have each month.) Prepare a monthly cash budget for the first six months of 2009. Calculate the loan requirement and surplus cash for each month of the six month cash budget using IF functions. (For each month of the cash budget, use a formula to calculate the loan requirement, and the surplus. The last two lines of the cash flow statement should be: LOAN REQUIREMENT SURPLUS Place all of the assumptions at the top of the spreadsheet, and use them. (USE ABSOLUTES: THERE SHOULD BE NO NUMBERS TYPED IN ANY FORMULAS OR IN THE CASH BUDGET STATEMENT. NUMBERS SHOULD BE TYPED IN THE ASSUMPTIONS AREA ONLY.)

Exam #1 Part 1 - CASH BUDGET Time left 1: Create a cash budget for the first six months of 2009 based on the following assumptions: Sales for the first month (Jan) are projected to be: Sales are projected to INCREASE each month by: $45,000 25% Collections of sales have been projected to be: Collected within the month of sales: Collected one month after sale: Uncollectable: 35% 60% 5% Expenses are paid during the month incurred. Expenses for the first month (Jan) are expected to be: Expenses are projected to INCREASE each month by: Monthly depreciation expenses (not included in the above monthly expense number) $30,000 2% $1,000 This new company will begin January of 2009 with a cash balance of $25,000 The company would like to maintain a minimum cash balance (target balance) of $50,000 Exam #1 Part 1 - CASH BUDGET Time left 1: Create a cash budget for the first six months of 2009 based on the following assumptions: Sales for the first month (Jan) are projected to be: Sales are projected to INCREASE each month by: $45,000 25% Collections of sales have been projected to be: Collected within the month of sales: Collected one month after sale: Uncollectable: 35% 60% 5% Expenses are paid during the month incurred. Expenses for the first month (Jan) are expected to be: Expenses are projected to INCREASE each month by: Monthly depreciation expenses (not included in the above monthly expense number) $30,000 2% $1,000 This new company will begin January of 2009 with a cash balance of $25,000 The company would like to maintain a minimum cash balance (target balance) of $50,000