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You have landed a new job as an accountant with U R Protected. The company produces vaccine refrigerators. They recently received a major contract to
You have landed a new job as an accountant with U R Protected. The company produces vaccine refrigerators. They recently received a major contract to distribute vaccines in rural areas. As a result, they began to revise their cash budget. In addition to their regular expenses, they will need to rent additional space to manufacture their products. They will pay for extraordinary rental expenses in May ($30,000) and June ($20,000) for a new wharehouse. March April May June $300,000 $500,000 $550,000 $400,000 Total cash receipts from all sales Cash disbursements for ordinary purchases and expenses Extraordinary Expenses for building Rental $390,000 $520,000 $530,000 $390,000 $30,000 $20,000 The company's cash balance on February 29, 2021, is expected to be $12,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a monthly interest rate of 12%. Because of the potential crisis, the company has an unlimited line of credit. The company must borrow any amount at the beginning of any month and may repay its loans, or any part of its loans, at the end of any month. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded. Prepare a cash budget for March, April, May, and June (you only need to prepare the cash budget including the financing section.) Remember that you do not want to borrow any more than necessary! Indicate the ending cash balance on June 30 in the space below. (10 POINTS) Indicate the ending loan balance on June 30 in the space below. (10 POINTS) Upload your Cash Budget IN GOOD FORM (20 POINTS)
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