Following are the budgeted income statements for the second quarter of 2019 for SeaTech Inc.:

	April				May				June
Sales	$	238,000			$	289,000			$	323,000
Cost of goods sold*		163,200				193,800				214,200
Gross profit	$	74,800			$	95,200			$	108,800
Operating expenses		37,400				42,500				45,900
Operating income	$	37,400			$	52,700			$	62,900

^* Includes all product costs (i.e., direct materials, direct labor, and manufacturing overhead). Includes all period costs (i.e., selling, general, and administrative expenses). The company expects about 30% of sales to be cash transactions. Of sales on account, 60% are expected to be collected in the first month after the sale is made, and 40% are expected to be collected in the second month after sale. Depreciation, insurance, and property taxes represent $20,400 of the estimated monthly cost of goods sold and $13,600 of the estimated monthly operating expenses. The annual insurance premium is paid in January, and the annual property taxes are paid in August. Of the remainder of the cost of goods sold and operating expenses, 80% are expected to be paid in the month in which they are incurred, and the balance is expected to be paid in the following month. Current assets as of April 1, 2019, consist of cash of $23,800 and accounts receivable of $254,660 ($178,262 from March credit sales and $76,398 from February credit sales). Current liabilities as of April 1 consist of $30,600 of accounts payable for product costs incurred in March; $7,820 of accrued liabilities for operating expenses incurred in March; and a $68,000, 12%, 120-day note payable that is due on April 17, 2019. An estimated income tax payment of $68,000 will be made in May. The regular quarterly dividend of $27,200 is expected to be declared in May and paid in June. Capital expenditures amounting to $29,240 will be made in April. Required: a. Complete the monthly cash budgets for the second quarter of 2019 using the following format. Note that the ending cash balance for June is provided as a check figure. (Use 360 days year for calculations.)

SEATECH INC.
Cash Budget
For the months of April, May, and June 2019
	April	May	June
Beginning cash balance	$23,800
Cash Receipts:
From cash sales made in current month
From credit sales made in:
February
March
April
May
Total cash available	$23,800	$0	$0
Cash Disbursements:
For cost of goods sold/operating expenses incurred in:
March
April
May
June
For payment of note payable and interest
For capital expenditures
For payment of income taxes
For payment of dividends
Total disbursements	$0	$0	$0
Ending cash balance	$23,800	$0	$38,080

b. Assume that management of SeaTech Inc. desires to maintain a minimum cash balance of $19,100 at the beginning of each month and has arranged a $100,000 line of credit with a local bank at an interest rate of 9% to ensure the availability of funds. Borrowing transactions are to occur only at the end of months in which the budgeted cash balance would otherwise fall short of the $19,100 minimum balance. Repayments of principal and interest are to occur at the end of the earliest month in which sufficient funds are expected to be available for repayment. (Do not round intermediate calculations. Use 360 days year for calculations.)

SEATECH INC.
Cash Budget
For the months of April, May, and June 2019
	April	May	June
Beginning cash balance	$23,800
Cash Receipts:
From cash sales made in current month
From credit sales made in:
February
March
April
May
Total cash available	$23,800	$0	$0
Cash Disbursements:
For cost of goods sold/operating expenses incurred in:
March
April
May
June
For payment of note payable and interest
For capital expenditures
For payment of income taxes
For payment of dividends
Total disbursements	$0	$0	$0
Excess (deficiency) of cash available over disbursements
Borrowings
Repayments
Interest
Ending cash balance	$0	$0	$0