Based on the following assumptions, determine what the financing needs will be for Public Cleaning Company assuming they have a desired ending cash balance of $30,000. Please assume that the beginning cash balance for all month was $0 and that 30% of sales are collected during the month of sale, 60% in the month after and 10% in the 2 months after the sale. December sales were $300,000. Inventory purchases are paid for 100% in the month following the purchase. All other expenses including equipment purchases are paid for in cash in the month they are incurred. Public Cleaning Company has the following estimated data:
January February March
Sales $350,000 $390,000 $380,000
Inventory Purchases $260,000 $305,000 $300,000
Operating Expenses $75,000 $85,000 $83,000
Purchases of Equipment $30,000 $10,000 $80,000
Payment of dividends $10,000 $20,000 $20,000
What is the amount of money that will need to be borrowed in February?