Question

Exercise 8-7 Cash Budget [LO8-8] Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has prepared the following summary of its budgeted cash flows: 1st Quarter $350, eee Total cash receipts Total cash disbursements 2nd Quarter $478,000 $363,000 3rd Quarter $400, eee $353, eee 4th Quarter $420,000 $373, 800 $393, eee The company's beginning cash balance for the upcoming fiscal year will be $20,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded

Answer 1

Please find attached sheets for detailed calculation,

33,000 requiring balance is 23000+10000

Please comment for any explanation

Thanks,

х 7 after 12.06.2020 - Microsoft Excel Cla Home Insert Page Layout Formulas Data Review View X Σ AutoSum Times New Rom - 11 A A Wrap Text General Fill 4 Cut En Copy Paste Format Painter Clipboard BI U Merge & Center 4.0 .00 .00 .0 Insert Delete Format 2 Clear - Conditional Format Cell Formatting as Table Styles Styles Sort & Find & Filter - Select Font Number Cells Editing B12 Alignment fx Repayment с A B D E F H J K L M N 1 2 3 4 5 Garden Depot Cash Budget Qtr 1 Qtr 2 Qtr 3 Qtr 4 Year $ 20,000.00 $ 10,000.00 $ 83,752.50 $1,30,752.50 $ 20,000.00 $3,50,000.00 $4,70,000.00 $4,00,000.00 $4,20,000.00 $16,40,000.00 $3,70,000.00 $4,80,000.00 $4,83,752.50 $5,50,752.50 $16,60,000.00 $3,93,000.00 $3,63,000.00 $3,53,000.00 $3,73,000.00 $14,82,000.00 $ -23,000.00 $1,17,000.00 $1,30,752.50 $1,77,752.50 $ 1,78,000.00 6 7 8 Begaining cash balance Total cash receipts Total Available Total cash disbusrement excess (deficiency) of cash available over distribution Financing Borrowings Repayment Interest Ending closing balance 9 10 11 12 $ 33,000.00 $ $ $ $ 33,000.00 $ 33,000.00 $ $ $ 33,000.00 $ $ 247.50 $ $ $ 247.50 $ 10,000.00 $ 83,752.50 $1,30,752.50 $1,77,752.50 $ 1,77,752.50 13 14 15 16 17 18 19 20 21 22 23 24 25 RE Ready Sheet4 Sheet3 Sheets Sheet6 Sheet7 Sheets Sheet Sheet10 Sheet11 Sheet12 Sheet12 Sheet13 BO 100% + O 06:04 18-06-2020

х ? X 123 fr Σ Calculate Now 7 after 12.06.2020 - Microsoft Excel Cin Home Insert Page Layout Formulas Data Review View Pa Define Name - Trace Precedents 5 Show Formulas f Use in Formula Trace Dependents Error Checking Insert AutoSum Recently Financial Logical Text Date & Lookup & Math More Name Watch Function Used - Time Reference & Trig Functions Manager Create from Selection Remove Arrows Evaluate Formula Window Remove Arrows → Evaluate Formula Function Library Defined Names Formula Auditing B12 for Repayment Formula Bar A B D E F G Calculation Calculate Sheet Options Calculation H 1 2 3 4 5 6 7 8 9 Garden Depot Cash Budget Qtr 1 Qtr 2 Qtr 3 Qtr 4 Year Begaining cash balance 20000 10000 --D14 =+E14 =+CS Total cash receipts 350000 470000 400000 420000 =SUM(C6:F6) Total Available =SUM(C5:06) =SUMD5:D6) =SUM(E5:16) ESUM(F5:F6) ESUM(G5:66) Total cash disbusrement 393000 363000 353000 373000 =SUM(C8:F8) excess (deficiency) of cash available over distribution =+C5-C12+C6-C8 =+D5+D6-DS =+E5+E6-E8 =+F5+F6-F8 =+G7-G8 Financing Borrowings =23000+10000 10 10 0 =SUM(C11:F11) Repayment =+C11 0 0 =SUM(D12:F12) Interest 10 =+D12*3%*3/12 0 0 =SUM(C13:F13) Ending closing balance =+C11+C9 =+D9-D12-D13 =+E9 =+F9 =+G5+G6-G8+G11-G12-G13 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 RE Sheet4 Sheet3 Sheets Sheet6 Sheet7 Sheets Sheet9 Sheet10 Sheet11 Sheet12 Sheet13 Ready HE 100% + O X 06:05 18-06-2020