Cash Budgeting
Rogier, Inc., expects to receive cash from sales of $45,000 in March. In addition, Rogier expects to sell property worth $3,500. Payments for materials and sup- plies are expected to total $10,000, direct labor payroll will be $12,500, and other expenditures are budgeted at $14,900. On March 1, the cash account bal- ance is $1,230.
Required
1. Prepare a cash budget for Rogier, Inc., for the month of March.
2. Assume that Rogier, Inc., wanted a minimum cash balance of $15,000 and that it could borrow from the bank in multiples of $1,000 at an interest rate of 12 percent per year. What would Rogier's adjusted ending balance for March be? How much interest would Rogier owe in April assuming that the entire amount borrowed in March would be paid back?