Motors Corporation manufactures motors for dirt bikes. The company requires a minimum $30,000 cash balance...
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Motors Corporation manufactures motors for dirt bikes. The company requires a minimum $30,000 cash balance at each month-end. If necessary, the company borrows to meet this requirement at a cost of 3% interest per month (paid at the end of each month). Any preliminary cash balance above $30,000 at month-end is used to repay loans. The cash balance on July 1 is $27,000, and the company has no outstanding loans. Budgeted cash receipts and budgeted cash payments (other than for interest on the loan and loan activity) follow. July August September Cash receipts $ 78,000 $ 104,000 $ 143,000 Cash payments 106,000 92,900 120,400 Prepare a cash budget for July, August, and September. Note: Negative balances and Loan repayment amounts (if any) should be indicated with a minus sign.
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