Good cash management is an essential job of the financial manager!

Question # 00746266 Posted By: shortone Updated on: 12/11/2019 03:27 AM Due on: 12/11/2019
Subject Finance Topic Finance Tutorials:
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1. Cash balance at start of month                                                                                                    

2. Net cash gain (loss) during month                                                                                               

3. Cash balance. at end of month (before financing)                                                                              

4. Minimum cash balance desired                                                                                                   

5. Surplus cash (OR) Deficit cash (Line 3 - Line 4)            


EXTERNAL FINANCING SUMMARY                                                                                        


6. External financing balance - start of month                                                                               

7. New financing required (negative of Line 5) (if deficit!)                                                           

8. Financing repayments (if surplus!)                                                                                              

9. Ext financing balance - end of month                                                                                         

10.Cash balance at end of month (Line 3 + Line 7 + Line 8)                                                                                                                




Assignment Details


Cash is King!


Good cash management is an essential job of the financial manager! You own a small auto sales business called King Kars. You stock up on inventory in February, April, June, and September. Your annual cash budget indicates that your MONTHLY NET CASH for the year will be the following:


JAN $5,000

FEB -$30,000

MAR $20,000

APRIL -$35,000

MAY $25,000

JUNE -$10,000

JULY $25,000

AUG  $25,000

SEPT -$30,000

OCT $15,000

NOV $15,000

DEC $25,000


You begin the year with a cash balance of $50,000, and the minimum cash balance desired must be $50,000 every month. Prepare cash flow summary and external financing summary as noted in the Excel spreadsheet assigned to this submission. 


  1. Do you believe that the company needs outside financing? 
  2. What is the minimum line of credit to request from a lender? 
  3. Do you think you are a good candidate for the line of credit? Why? 
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Tutorials for this Question
  1. Tutorial # 00744783 Posted By: shortone Posted on: 12/11/2019 03:32 AM
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