Answer:
a. Ending Cash Balance:
January = 50,000
February = 61,555
March = 50,000
b. Loan Balance End of Month:
January = 44,500
February = $0
March = $44,445
Explanation:
Note: The merged data given in the question are sorted before answering the question as follows:
Cash Receipts Cash payments
January $ 518,000 $ 461,500
February 403,000 346,500
March 467,000 523,000
Explanation of the answer is now given as follows:
Note: See the attached excel file for the cash budget.
In the attached excel file, the following calculations are made:
January loan repayment = January Preliminary cash balance - Minimum required cash balance = $105,500 - $50,000 = $55,500
March Additional loan = Minimum required cash balance - March Preliminary cash balance = $50,000 - $5,555 = $44,445
From the attached excel file, we have:
a. Ending Cash Balance:
January = 50,000
February = 61,555
March = 50,000
b. Loan Balance End of Month:
January = 44,500
February = $0
March = $44,445
