Edward Lewis, Bonita & Brian Fabricators' budget director, has received budget information from several managers and is preparing the company's cash budget. January February March Quarter Collections from sales 478,200 561,860 638,720 1,678,780 Payments for direct materials 80,505 253,125 280,730 614,360 Payments for direct labor 98,640 103,680 116,640 318,960 Payments for manufacturing overheads 78,490 78,980 80,240 237,710 Payments for Selling & administrative expenses 111,400 116,440 123,160 351,000 In addition to the information he received from these managers, Edward knows the following: . Bonita & Brian plans to have $32,400 in its cash account on January 1. Bonita & Brian plans to purchase and pay cash for a piece of land in January at a cost of $89,000. Bonita & Brian plans to make a cash purchase of equipment in March at a cost of $28,000. . Bonita & Brian's income taxes from last quarter totaling $26,400 will be paid in January. Bonita & Brian is required to maintain a minimum cash balance of $50,000 in its account at First National Bank. Bonita & Brian has negotiated with the First National Bank to provide a $175,000 line of credit that can be borrowed against in $1,000 increments on the first day of the month. Any repayments on the line of credit must also be made in $1,000 increments and are made on the last day of the month when cash is available. The annual interest rate on this line of credit is 6%. Any time a principal payment is made, all accrued interest to date is repaid.