Question 2: The Al-Majid Construction Management Company constructs and operates differentcommunities in certain parts of UAE. The past few years have been difficult ones for Al-Majid facilitymanagement company. The demand for Al-Majid Construction Management has been light and thecompany has been unable to maintain full occupancy. However, Al-Majid Construction management hasrecently broken ground for the construction of a new community and has more new constructionplanned over the next 4 years (2022 through 2025). The chief financial officer (CFO) at Al-MajidConstruction Management Company, has projected Al-Majid's net cash flows over the next 4 years asshown in the table below, Al-Majid will have negative cash flow for the next few years. With only $1million in cash reserves, it appears that AL-Majid will need to take out some loans in order to meet itsfinancial obligations.The main objective is to Mmaximize cash-balance position in 2025, considering the below FinancialParameters: calculate the ending balance of 2022 and 2023....Long Term 5-Year (LT) Loan: 5% interest rate.Short Term 1-Year (ST) Loan: 7% interest rate.2022 long term loan of 6m & short term loans of 2 m2023 long term loan 5mYear2022202320242025Projected NetCash Flow(Millions ofAED)-8-2-43Note: You need to present the how you calculate the ending balance for each Year using the belowformula:Ending Balance Starting Balance + Cash Flow+Loans - Interest Payments - Loan Payments

Cash balance at any period is the balance of cash which are available to the company and by the loan…

Answered: bjective is to Mmaximize cash ;…

Business

Accounting

bjective is to Mmaximize cash ; calculate the ending balance of 2022 and 2023. interest rate.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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