Danner Company expects to have a cash balance of $50,400 on January 1, 2020. Relevant monthly budget data for the first 2 months of 2020 are as follows.

Collections from customers: January $95,200, February $168,000.

Payments for direct materials: January $56,000, February $84,000.

Direct labor: January $33,600, February $50,400. Wages are paid in the month they are incurred.

Manufacturing overhead: January $23,520, February $28,000. These costs include depreciation of $1,680 per month. All other overhead costs are paid as incurred.

Selling and administrative expenses: January $16,800, February $22,400. These costs are exclusive of depreciation. They are paid as incurred.

Sales of marketable securities in January are expected to realize $13,440 in cash. Danner Company has a line of credit at a local bank that enables it to borrow up to $28,000. The company wants to maintain a minimum monthly cash balance of $22,400. Prepare a cash budget for January and February.

DANNER COMPANY Cash Budget For the Two Months Ending February 28, 2020 January February Beginning Cash Balance Add : Receipts Collections from Customers Sale of Marketable Securities Total Receipts Total Available Cash Less : Collections from Customers Direct Materials Direct Labor Manufacturing Overhead Selling and Administrative Expenses Selling and Administrative Expenses Total Disbursements Excess (Deficiency) of Available Cash Over Cash Disbursements Financing Less : Borrowings Add : Repayments Ending Cash Balance