Where does the borrowing of $219,000 come from? Where are the numbers above that I must borrow and use in order to compute this borrowing of $219,000? Can you show me the step by step work to compute the borrowing of $291,000, please?

What was done mathematically to compute and get the Repayment amounts of $11,000 or -$11,000, $208,000 or -$208,000, and $219,000 or -$219,000 in the Cash Budget? Can you all show me the numbers used and the step by step work involved to get these values, please? Thank you!

Part 2 - Departmental and Master Budgets SRS Educational Supply Company provides educational materials and supplies to educational institutions. The SRS business model is to be a one-stop provider of educational supply needs. For example, some of their product lines include educational workbooks, classroom visual aids, instructor support materials, art supplies, lab supplies, and administrative office supplies. While SRS serves all levels of educational institutions, the majority of their customers are K-12 schools. Sales can vary quite a bit from month-to-month as K-12 educational institutions have seasonal ordering patterns. Thus, budgeting is vital for planning and cash flow purposes. SRS has a June 30, fiscal year end. The company's balance sheet at June 30 is given below: Liabilities & Stockholders' Equity Accounts payable $ 130,000 Assets Cash Accounts receivable Inventory Prepaid insurance Building & equip. (net) Total assets S 40,000 340,000 50,000 18,000 860,000 $ 1,308,000 420.000 758,000 Capital stock Retained earnings Total liabilities & stockholders' equity $ 1,308,000 The company's income statement for the year ending June 30 is given below: Sales Cost of goods sold $ 5,523,000 2,541,000 $ 2,982,000 Gross margin Selling and administrative expenses Shipping Other Salaries and wages Advertising Insurance Depreciation Total operating expenses Net operating income Interest expense Net income $ 249,000 511,000 1.104,000 685,000 27,000 228,000 2,804,000 S 178,000 25,000 S 153,000 The following forecasts have been provided by the organization: Sales forecasts range July $550.000 - $650,000 August $900,000 - $980,000 September $450,000 - $550,000 October $360,000 - $420,000 November $350,000 - $480,000 December $350,000 - $480,000 Purchasing cost range (July - December) Cost of goods sold 42% - 50% Operating expense range (July December) Shipping 4% - 5% of sales Other expenses 8% -9.5% of sales Salaries and wages $85,000 to $95.000 per month Advertising $45,000 - $58,000 per month Insurance $2,000 - $3,000 per month Depreciation $25,000 per month General Instructions for Master Budget Assignment The company has four main departments: Sales, Purchasing, Operations and Finance. Based on the information provided about each department, you will create a master budget for the three- month period beginning July 1 and ending September 30. You are responsible for creating a budget for each department that will become the master budget. The master budget must include the following detailed budgets: . A sales budget by month and in total A schedule of expected cash collections from sales, by month and in total A merchandise purchase budget in dollars. Show the budget by month and in total A schedule of expected cash disbursements for merchandise purchases, by month and in total A selling and administrative budget, by month and in total A schedule of expected cash disbursements for selling and administration, by month and in total A cash budget. Show the budget by month and in total A budgeted income statement for the three-month period ending September 30 A budgeted balance sheet as of September 30 . - Additional Financial Information for the Sales Department SRS has a large number of customers that are K-12 educational institutions. As a result, SRS receives large orders for educational supplies in July and August as schools get ready for the start of the academic year. This is also when educational budgets are still plentiful. Sales begin to decline in September and October and then monthly sales stabilize for the rest of the year (November - June) to a range between $350,000 and $480,000. Actual sales for June and your forecasted sales for the next four months are as follows: June (actual) $455,000 July Likely Range: $550,000 - $650,000 (most likely outcome is $600,000) August Likely Range: $900,000 - $980,000 (most likely outcome is $910,000) September Likely Range: $450,000 - $550,000 (most likely outcome is $475,000) October Likely Range: $360,000 - $420,000 (most likely outcome is $385,000) As the accountant, your specific responsibility is to prepare a sales budget and a schedule of expected cash collections from sales by month and in total (July-September). Additional Financial Information for the Purchasing Department Most of SRS' clients expect a one to three-day turn-around time for orders. It typically takes a week for the company to get merchandise. As a result, the organization states that it has approximately a week's worth of inventory on hand at all times. For budgeting purposes, the organization should plan to purchase enough merchandise during any one month to meet the sales projections for that month and to end the month with 20% of the next month's cost of merchandise sold. The company's cost of merchandise sold ranges from 42% - 50% of sales with the most likely outcome for next quarter (July - September) of 45% of sales. -As the accountant, your responsibility is to prepare a merchandise purchase budget (in dollars) and a schedule of expected cash disbursements for merchandise purchases by month and in total (July-September) Additional Financial Information for the Operations Department The Operations and Logistics Department of SRS Educational Supply Company secures advertising that supports the sales efforts, coordinate shipping and delivery of merchandise to clients and provide general administrative support to the other departments. The organization has estimated the company's monthly operating expenses for the next quarter (July-September) as follows: Variable: Shipping Other expenses 4.0% to 5.0% of sales with 5% of sales the most likely outcome 8.0% to 9.5% of sales with 8% of sales the most likely outcome Fixed: Salaries and wages $85,000 to $95.000 with $85,000 the most likely outcome Advertising $45,000 to $58,000 with $50,000 the most likely outcome Insurance $2,000 to $3,000 with $3,000 the most likely outcome Depreciation $25,000 As the accountant, you will prepare a selling and administrative budget and a schedule of expected cash disbursements by month and in total (July-September). Additional Financial Information for the Finance Department The Accounting and Finance Department of SRS Educational Supply Company manages the accounts receivable and collections, accounts payable, general ledger, and handles the cash management, borrowing and investing activities of the company. Historic collection data (cash collections of sales): All sales are on credit, with no discounts, and due in 15 days. The company has found, however, that only 30% of a month's sales are collected by month-end and the remaining 70% is collected in the following month. Historic payment data: Purchases of inventory are paid for as follows: 50% in the month of purchase and the remaining 50% in the following month. Other operating expenses are paid in cash during the month they are incurred. Other planned outlays of cash: During July, purchases of automated equipment totaling S200,000 for cash. New computers for the office will be purchased during August for $90,000 cash. The company plans on declaring and paying dividends of $50,000 during July. Cash management policies: Desired minimum ending cash balance each month: $35,000 The company has a line of credit with a bank The company can borrow in increments of $1,000 at the beginning of each month. The interest rate on these loans is 1% per month and we assume a simple interest calculation (not compounded). At the end of each month, the company pays the bank as much of the loan as possible (increments of $1,000), while still retaining at least $35,000 in cash. For simplicity, the company pays the bank the interest related to the borrowing for one month at the beginning of the next month. For example, the interest on any borrowing in June is paid in July. As the accountant, you will prepare a cash budget by month and in total (July-September) and a Budgeted Income Statement for the quarter ending September 30. * Depreciation on newly acquired assets will be made as an adjustment at the end of the fiscal year. July 600,000 $ August September 910,000 $ 475,000 $ October 385,000 $ Part 1 Information 45% 20% 1 MOST LIKELY NUMBERS AND ASSUMPTIONS 2 SALES MANAGER PRIVATE INFORMATION 3 Most likely sales 4 5 6 7 PURCHASING MANAGER PRIVATE INFORMATION 8 Most likely cost of merchandise as a % of sales 9 Desired ending inventory as a percentage of next month's cost of sales 10 11 12 OPERATION MANAGER PRIVATE INFORMATION 13 Most likely shipping expenses as a percent of sales 14 Most likely other expenses as a percent of sales 15 Salaries and wages (per month) 16 Most likely advertising costs (per month) 17 Most likely insurance costs (per month) 18 Depreciation expense (per month) 19 20 21 FINANCE MANAGER PRIVATE INFORMATION 22 Percent sales collected in month of sale 23 Percent sales collected in month after sale 24 25 Percent of inventory purchases paid in month of purchase 26 Percent of inventory purchases paid in month after purchase Part 1 Information 5.0% 8.0% $ 85,000 50,000 3,000 $ 25,000 Part 1 Information 30% 70% 50% 50% 100% 0% 29 30 $ $ 35,000 1,000 1% 37 $ $ July 200,000 $ 50,000 $ August September 90,000 $ $ 28 Percent of operating expenses paid in month of purchase Percent of operating expenses paid in month after purchase 31 Desired minimum ending cash balance each month 32 Borrow in increments of 33 Monthly interest rate on borrowings (not compounded) 34 35 36 Other planned outlays of cash Capital expenditures 38 Dividends 39 40 41 42 SRS Educational Supply Company 43 Balance Sheet 44 Previous Year End 45 Assets 46 Current assets: 47 Cash 48 Accounts receivable 49 Inventory 50 Prepaid insurance 51 Total current assets 52 Buildings and equipment (net) 53 TOTAL ASSETS $ $ $ $ 40,000 340,000 50,000 18,000 $ 448,000 $ 860,000 $ 1,308,000 Liabilities and Equity $ $ 130,000 54 55 56 Liabilites 57 Accounts payable 58 Notes payable 59 Total liabilities 60 Stockholder's equity 61 Capital stock 62 Retained earnings 63 Total equity 64 TOTAL LIABILITIES AND EQUITY $ 130,000 $ $ 420,000 758,000 $ 1,178,000 $ 1,308,000 CE Sales Budget 1 2 3 4 Quarter July $600,000 August September $910,000 $475,000 5 Sales 6 $1,985,000 8 8 9 June sales (A/R From Beginning Balance Sheet) 10 July sales - Collected in Current Month 11 July sales - Collected in Following Month 12 August sales - Collected in Current Month 13 August sales - Collected in Following Month 14 September sales - Collected in Current Month 15 Total Expected Cash Collections Schedule of Cash Collections July August September Quarter $340,000 $340,000 $180,000 $180,000 $420,000 $420,000 $273,000 $273,000 $637,000 $637,000 $142,500 $142,500 $520,000 $693,000 $779,500 $1,992,500 16 17 16 17 18 19 Total Sales for the Quarter 20 A/R at the end of the Quarter September Sales Still not Collected) 21 $ 1,985,000 $ 332,500 Inventory Purchase Budget July August September $ 600,000 $ 910,000 $ 475,000 $ 45% 45% 45% $ 270,000 $ 409,500 $ 213,750 $ October 385,000 45% 173,250 3 4 5 Sales 6 Cost of Merchandise as % of Sales 7 Budgeted Cost of Merchandise Sold 8 9 Following Month's COGS 10 Desired Ending Inventory % 11 Desired Ending Inventory Dollars 12 13 Budgeted Cost of Merchandise Sold 14 Plus Desired Ending Inventory 15 Total Inventory Needs 16 Less Beginning Inventory 17 Required Purchases $ 409,500 $ 213,750 $ 173,250 20% 20% 20% 81,900 42,750 34,650 270,000 409,500 213,750 81,900 42,750 34,650 351,900 452,250 248,400 50,000 81,900 42,750 $ 301,900 $ 370,350 $ 205,650 18 19 20 21 21 22 Schedule of Expected Cash Disbursements - Purchases 23 July August September Quarter 24 June Purchases (A/P From Balance Sheet) $ 130,000 $ 130,000 25 July Purchases $150,950 $ 150,950 $ 301,900 26 August Purchases $ 185,175 $ 185,175 $ 370,350 27 September Purchases $ 102,825 $ 102,825 28 Total Disbursements $ 280,950 $ 336,125 $ 288,000 $ 905,075 29 30 31 32 Cost of Merchandise Sold for the Quarter $ 893,250 33 Ending Inventory at the end of the Quarter $ 34,650 34 Ending A/P at the end of the Quarter $ 102,825 N Selling and Administrative Budget July August September Quarter $ 600,000 $ 910,000 $ 475,000 $1,985,000 5% 5% 5% 5% 8% 8% 8% 8% 1 2 3 4 5 6 Sales 7 Shipping as a Percentage of Sales 8 Other Expenses as a Percentage of Sales 9 10 11 Variable Expenses: 12 Shipping 13 Other Expenses 14 Total Variable Expenses 15 Fixed Expenses: 16 Salaries and Wages 17 Advertising 18 Prepaid Insurance 19 Depreciation 20 Total Fixed Expesnes 21 Total Selling and Admin Expenses 22 30,000 48,000 78,000 45,500 72,800 118,300 23,750 38,000 61,750 99,250 158,800 258,050 85,000 50,000 3,000 25,000 163,000 241,000 85,000 50,000 3,000 25,000 163,000 281,300 85,000 50,000 3,000 25,000 163,000 224,750 255,000 150,000 9,000 75,000 489,000 747,050 28,000 213,000 28,000 253,300 28,000 196,750 84,000 663,050 23 Less Noncash Items (Depreciation and Prepaid Ins) 24 Total Cash Disbursements 25 26 27 28 Prepaid Insurance That Is Expensed During the Quarter 29 Depreciation Expense Recognized During the Quarter $ $ 9,000 75,000 1 N 4 July 40,000 520,000 560,000 Cash Budget August September 35,050 35,435 693,000 779,500 728,050 814,935 Quarter 110,485 1,992,500 2,102,985 288,000 196,750 5 6 Cash Balance: Beginning 7 Add Cash Collections (From Sales Budget) 8 Total cash Available 9 Less Cash Disbursements 10 For Inventory (From Purchasing Budget) 11 For Operating Expenses (From Selling and Admin Budg 12 For Equipment 13 For Cash Dividends 14 For Interest (From Previous Month's Borrowing) 15 Total Cash Disbursements 16 Excess (Deficiency) of Cash 17 Financing 18 Borrowing 19 Repayment 20 Total Financing 21 Cash Balance: Ending 22 280,950 213,000 200,000 50,000 0 $ 743,950 (183,950) 336,125 253,300 90,000 0 2,190 $ 681,615 46,435 0 2,080 486,830 328,105 905,075 663,050 290,000 50,000 4,270 1,912,395 190,590 219,000 219,000 35,050 (11,000) (11,000) 35,435 (208,000) (208,000) 120,105 (219,000) 0 190,590