Lally Auto Parts' bank requires a $10,000 minimum balance in the store's checking account. At the...

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Lally Auto Parts' bank requires a $10,000 minimum balance in the store's checking account. At the end of any month when the account balance falls below $10,000, the bank automatically extends credit to the store in multiples of $1,000. Lally Auto Parts borrows as little as possible and pays back loans in quarterly installments of $2,000, plus 3% APR interest on the entire unpaid principal. The first payment occurs three months after the loan. 1. Prepare Lally Auto Parts' cash budget for January and February. 2. How much cash will Lally Auto Parts borrow in February if collections from customers that month total $14,200 instead of $15,200? Lally Auto Parts' bank requires a $10,000 minimum balance in the store's checking account. At the end of any month when the account balance falls below $10,000, the bank automatically extends credit to the store in multiples of $1,000. Lally Auto Parts borrows as little as possible and pays back loans in quarterly installments of $2,000, plus 3% APR interest on the entire unpaid principal. The first payment occurs three months after the loan. 1. Prepare Lally Auto Parts' cash budget for January and February. 2. How much cash will Lally Auto Parts borrow in February if collections from customers that month total $14,200 instead of $15,200?

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Lally Auto Parts Cash Budget Assumptions Beginning cash balance for JanuaryUnknown Inventory purchas... View the full answer