Cheyenne Company has budgeted the following information for June: $$\begin{array} { | l | r | } \hline \text { Cash receipts } & \$ 271,000 \ \hline \text { Beginning cash balance } & 5,000 \ \hline \text { Cash payments } & 280,000 \ \hline \text { Desired ending cash balance } & 25,000 \ \hline \end{array}$$ If there is a cash shortage, the company borrows money from the bank. All cash is borrowed at the beginning of the month in $1,000 increments and interest is paid monthly at 1% on the first day of the following month. The company had no debt before June 1^st. The amount of interest paid on July 1 would be:

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The Answer of Cheyenne Company has budgeted the following information for June: $$\begin{array} { | l | r | } \hline \text { Cash receipts } & \$ 271,000 \ \hline \text { Beginning cash balance } & 5,000 \ \hline \text { Cash payments } & 280,000 \ \hline \text { Desired ending cash balance } & 25,000 \ \hline \end{array}$$ If there is a cash shortage, the company borrows money from the bank. All cash is borrowed at the beginning of the month in $1,000 increments and interest is paid monthly at 1% on the first day of the following month. The company had no debt before June 1^st. The amount of interest paid on July 1 would be:

Cheyenne Company Has Budgeted the Following Information for June If There Is a Cash Shortage, the Company Borrows Money