Exercise 07-17 Preparation of cash budgets (for three periods) LO P2 Kayak Co. budgeted the following cash receipts (excluding cash receipts from foans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year, January February March Cash Receipta $521,000 406,000 467.000 Cash payments $461,200 346,200 535,000 According to a credit agreement with its bank, Kayak requires a minimum cash balance of $40,000 at each month-end. In return, the bank has agreed that the company can borrow up to $160,000 at a monthly interest rate of 1%, pald 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 $40,000 on the last day of each month. The company has a cash balance of $40,000 and a loan balance of $80,000 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 $ 40,000 $ 40,000 621,000 406.000 561,000 446.000 March 52,800 Beginning cash balance Cash receipts Total cash available Cash payments Interest expenso Preliminary cash balance Check my w According to a credit agreement with its bank, Kayak requires a minimum cash balance of $40,000 at each month-end. In return, the bank has agreed that the company can borrow up to $160,000 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 $40,000 on the last day of each month. The company has a cash balance of $40,000 and a loan balance of $80,000 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.) March 52.800 KAYAK COMPANY Cash Budget For January February, and March January February Beginning cash balance $ 40,000 $ 40.000 Cash receipts 521.000 406.000 Total cash available 561,000 448.000 Cash payments interest expense Preliminary cash balance Additional loan loan repayment) Ending cash balance Loan balance Loan balance - Beginning of month $ 80,000 5 40,000 $ Additional loan loan repayment Loan balance - End of month $ 40.000