Brampton Manufactures has a line of credit with their bank and must keep a $15,000 minimum balance each month. There is no outstanding loan at the beginning of January. Loans can be borrowed and repaid in any amount. The cash balance on January 1 is expected to be $10,000.

Sales were $40,000 in December, and are budgeted to be $50,000 in January and $60,000 in February. All sales are on account and are collected 50% in the month of sale and 50% in the following month.

All other expenses are listed below, and are all paid in cash in the month incurred:

Direct materials $20,000 per month

Sales Commissions 10% of sales per month

MOH $15,000 per month and includes depreciation of $5,000 monthly

Selling & Admin Exp $9,000 per month and excludes depreciation of $200 monthly

Interest on borrowing is $100 per month