The accountant for Nelly's Dress Shop prepared the fourth quarter 2017 cash budget that appears on the following spreadsheet. Nelly's has a policy to maintain a minimum cash balance of $14,000 before the interest payment at the end of each month. The shop borrows and repays funds on the first day of the month. The interest rate is 2 percent per month.
Required:
a. Construct a spreadsheet to model the cash budget as shown in the following screen capture. Be sure to use formulas where possible so that any changes to the estimates will be automatically reflected in the spreadsheet.
Spreadsheet Tips:
(1) Rows 11, 15, 17, 18, 20 to 22, and 24 should be based on formulas.
(2) Cells F6, H6, F9, and H9 should also be based on formulas. For example, cell F6 should be =D24.
