Royal industries has budgeted the following information for january: cash receipts $ 40,000 beginning cash balance $ 10,000 cash payments $ 48,000 desired ending cash cushion $ 5,000 if there is a cash shortage, the company borrows money. if a surplus occurs funds are used to repay loans or to invest in short-term assets. all borrowing, repayments, and interest payments occur on the last day of the month. the interest rate is 1% per month. the amount of interest expense incurred for january is:

a. $20.
b. $30.
c. $50.
d. none of the above.

correct option is D. None of the above

Explanation:

given data

Cash Receipts =  $40,000

Beginning Cash Balance = $10,000

Cash Payments = $48,000

Desired Ending Cash Cushion = $5,000

interest rate = 1% per month

to find out

amount of interest expense incurred for January

solution

we get here first Cash available that is

Cash available  = Cash Receipts + Beginning Cash Balance - Cash Payments   1

Cash available  = $40,000 + $10,000 - $48,000

Cash available = $2,000

so

Borrow amount is = Desired Ending Cash Cushion - Cash available   2

Borrow amount = $5,000 - $2000

Borrow amount = 3,000

so here borrow amount is made at last month so that no interest will be accrued for January

interest will paid t end of February

so correct option is D. None of the above

answer(b); ; ; the quantitative or qualitative variable for which the experimenter wishes to determine how its value is affected by the explanatory variable;

start networking with people and see what is availble