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frozen [14]
3 years ago
6

Good cash management is an essential job of the financial manager. You own a small auto sales business called King Kars. You sto

ck up on inventory in February, April, June, and September. Your annual cash budget indicates that your MONTHLY NET CASH for the year will be the following:
JAN $5,000
FEB -$30,000
MAR $20,000
APRIL -$35,000
MAY $25,000
JUNE -$10,000
JULY $25,000
AUG $25,000
SEPT -$30,000
OCT $15,000
NOV $15,000
DEC $25,000

You begin the year with a cash balance of $50,000, and the minimum cash balance desired must be $50,000 every month.
1. Prepare a cash flow summary and external financing summary as noted in the Excel spreadsheet assigned to this submission.
2. Do you believe that the company needs outside financing?
3. What is the minimum line of credit to request from a lender?
Do you think you are a good candidate for the line of credit? Why?

Business
2 answers:
KATRIN_1 [288]3 years ago
6 0

Answer:

The prepared cash flow and external funding summary are found in the attached.

I believe the company needs external funding in February-June as well as in September.

The company is a good candidate for line of credit as it has positive cash flows with which it could pay back any external financing taken.

The minimum line of credit required is $40,000 as shown by cash flow summary in April.

Explanation:

Find attached for details

Download xlsx
nikdorinn [45]3 years ago
4 0

Answer:

Explanation:

The answer to the above question is given in the attached document.

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The effective rate of a $25,000 non-interest-bearing simple discount 10%, 90-day note is
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<span>For the answer to the question above, the $25,000 due in 90 days.
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If the total debt ratio is 36%, and the allowable mortgage debt ratio is 28%, which of the following debt ratios would a loan ap
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