7 Exercise 20-17 Preparation of cash budgets (for three periods) LO P2 Kayak Co. budgeted the following cash receipts (excluding ceash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year. Caah Cash January February March Receipts $525,000 403, 000 461, 000 payments 6467,400 345, 400 522, 000 According to a credit agreement with the company's bank, Kayak promises to have a minimum cash balance of $50,000 at each month-end. In return, the bank has agreed that the company can borrow up to $140,000 at a monthly interest rate of 1% , paid on the last day of each month. The interest is computed based on the beginning balance of the loan for the month. The company repays loan principal with any cash in excess of $50,000 on the last day of each month. The company has a cash balance of $50,000 and a loan balance of $100,000 at January 1. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) KAYAK COMPANY Cash Budget For January, February, and March January February March Beginning cash balance S 50,000 Total cash available Prev 8 of 9 Next> Prepare monthly cash budgets for January, February, and March. (Negative ba be indicated with minus sign.) KAYAK COMPANY Cash Budget For January, February, and March March February January 50,000 50,000 $ Beginning cash balance Cash receipts 461,000 403,000 525,000 453,000 345,400 Total cash available Cash payments Interest expense Preliminary cash balance Additional loan (loan repayment) 575,000 522,000 467,400 434 1,000 106,600 107,166 (56,600) Ending cash balance $ 50,000 Loan balance Loan balance - Beginning of month 100,000 S 43.400 $ 0 Additional loan (loan repayment) (56.600) Loan balance- End of month 43,400