Motors Corporation manufactures motors for dirt bikes. The company requires a minimum
$30,000
cash balance at each month-end. If necessary, the company borrows to meet this requirement at a cost of
2%
interest per month (paid at the end of each month). Any preliminary cash balance above
$30,000
at month-end is used to repay loans. The cash balance on July 1 is
$38,000
, and the company has no outstanding loans. Budgeted cash receipts and budgeted cash payments (other than for interest on the loan and loan activity) follow.
\table[[Cash rec,\table[[July]],August,September],[Cash pay,\table[[
$89,000