Assume you are a producer who is preparing a quarterly cash flow budget for the upcoming year. You expect to begin the year with $60,000 of current debt. Based on your cash flow projections, you do not expect to make any payment on current debt during quarter 1; however, you anticipate having cash available of $13,000 in quarter 2. You must maintain a minimum cash balance of $5,000 at the end of each quarter. Assume the interest rate on your current debt is 8% annually and interest accrues only on the outstanding current debt balance (ie. interest does not compound on itself). 

How much will you be able to pay toward current interest at the end of quarter 2?

Answer rating: 100% (QA)

Interest Principal x Rate x Time Where Prin... View the full answer