Mcbride pays its vendor on the last day of the month also., Ask an Expert

Accounting

McBride Medical Clinic has budgeted the following cash flows
January February March
Cash receipts 101000 108000 125000
Cash payments
For inventory purchases 92000 72000 83000
For S&A expenses 30000 32000 26000

McBride Medical had a cash balance of 7000 on January 1. The company desires to maintain a cash cushion of 5000. Funds are assumed to be borrowed in increments of 1000 and repaid on the last day of each month; the interest rate is 1 percent per month. McBride pays its vendor on the last day of the month also. The company had a 30000 beginning balance in its line of credit liability account.
Required

Prepare a cash budget (round to nearest whole dollar)

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M991783

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