Exercise 7-17 (Algo) Preparation of cash budgets (for three periods) LO P2 Kayak Company budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year. Cash Receipts Cash payments January $ 526,eee $ 467,300 February 484,500 March 456, 531,200 345,800 Kayak requires a minimum cash balance of $40,000 at each month-end. The company can borrow money 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. Any preliminary cash balance above $40,000 is used to repay loans at month-end. 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 January S 40.000 526.000 March Beginning cash balance February s 40,000 404,500 450.000 Total cash available 568,000 444.500 467,300 467,300 0 0 Total cash payments Preliminary cash balance Loan activity Additional loan (loan repayment) Ending cash balance Loan balance $ 80,000 $ Loan balance - Beginning of month Additional loan (loan repayment) Loan balance, end of month