Question 9 (1 point) Using the following information based on expected sales to

Question

Question 9 (1 point) Using the following information based on expected sales to forecast the monthly cash collections, accounts receivable balance, monthly cash disbursements, net cash flows, and ca surplus /deficit at the end of each month in the fourth quarter of 2017 (October Decembe 2017. Do not allow your firm to have a cash balance below the minimum cash balance and only borrow what you need. ALL SALES ARE MADE ON CREDIT What is the firm's total cash disbursements for the month of December 2017? the firm's net cash flows, and ca Question 10(3 points) What is the firm's short term debt at the end of October 2017? a. In September 2017, sales were $50,000. Question 11 (3 points) b. The firm's total sales in 2016 were $2.028,000. The firm's accounts receivable balance on December 31, 2015 was $35,000. The firms accounts receivable balance on December 31 2016 was $65,000 What is the firm's short term debt at the end of November 2017? c. Accounts payable are 60% of sales d. Operating expenses are 10% of sales e. The firm plans to purchase equipment in October costing $125,000 f. Beginning Cash Balance in October $25,000 8. Minimum Cash Balance $5,000 Question 12 (3 points) What is the firm's short term debt at the end of December 2017 h. Assume there is an annual interest rate of 18% on short term debt and that the firm starts with no short term borrowing L Sales are expected to be $40,000 for October 2017, $400,000 for November 2017, and 100,000 for December 2017,

Explanation / Answer

Dec '15 2016 Sep Oct Nov Dec Sales 2028000 50000 40000 400000 100000 Accounts receivable 35000 65000 50000 40000 400000 100000 Accounts payable 1216800 30000 24000 240000 60000 Operating expenses 202800 5000 4000 40000 10000 Equipment purchase 125000 Beginning cash balance 25000 84000 5000 Cash receipts - Account receivable 30 day collection 50000 40000 400000 Cash payments- Accounts payable 30 day cycle + Operating expense +other purchases 159000 64000 250000 Cash balance -84000 60000 155000 Minimum cash balance 5000 5000 5000 5000 Short term borrowing 84000 29000 0 Interest on Short term borrowing - 18% 1260 435 0 Short term borrowing-repayed 0 55000 29000 Closing cash balance 84000 5000 126000 Calculations Accounts receivable as % of sales 38% Question 9 Firm's total cash disbursements for Dec 2017 is $250000 Question 10 Firms short term debt at the end of Oct 17 is $84000 Question 11 Firm's short term debt at the end of Nov 17 is $29000 Question 12 Firm's short term debt at the end of Dec 17 is 0

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