BU121 Lecture Notes - Lecture 11: Unit, Fixed Cost, Variable Cost
Document Summary
Bu121 lecture 11: determine end cash balance from this, never assume you are going to get paid when you think you will. This will be the ending balance (this becomes the beginning for the next month: when cash is excess it becomes surplus cash, you now use this cash to pay off the financing (7050-6700=350) Ending cash balance is 350 + 6000(the amount you always keep as a cushion: august balance becomes 6350, and continue the process, in this case the cash available the receipts = 4600 in cash excess. But you need 6000 as a balance so you get financing for 1400. Ending cash balance should equal 6000 and above: interest can be calculated as well as part of the question- (financing required * interest rate * time/12) gain clarity on this concept. Deficiency: finance deficiency + minimum, ending balance = minimum required, 2.
