According to a credit agreement with the company's bank, Marble Company promises to have a minimum cash balance of $50,000 at each month's end. In return, the bank has agreed that the company can borrow up to $150,000 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.

Marble Co. budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principaland interest payments) for the first three months of next year.

Cash Receipts

Cash Payments

January

$550,000

$430,000

February

$425,000

$325,000

March

$475,000

$550,000

1. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts, if any, should be indicated in parentheses "( )"
2. If the cash receipts and cash payments changed to the values shown in the table below, how would the budget change?

Cash Receipts

Cash Payments

January

$350,000

$430,000

February

$400,000

$325,000

 March $575,000 $400,000