Following are the budgeted income statements for the second quarter of 2022 for SeaTech Incorporated:

	April	May	June
Sales	$ 210,000	$ 255,000	$ 285,000
Cost of goods sold*Footnote asterisk	144,000	171,000	189,000
Gross profit	$ 66,000	$ 84,000	$ 96,000
Operating expensesFootnote dagger	33,000	37,500	40,500
Operating income	$ 33,000	$ 46,500	$ 55,500

*Footnote asterisk Includes all product costs (i.e., direct materials, direct labor, and manufacturing overhead).

Footnote dagger 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 $18,000 of the estimated monthly cost of goods sold and $12,000 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, 2022, consist of cash of $21,000 and accounts receivable of $224,700 ($157,290 from March credit sales and $67,410 from February credit sales). Current liabilities as of April 1 consist of $27,000 of accounts payable for product costs incurred in March; $6,900 of accrued liabilities for operating expenses incurred in March; and a $60,000, 15%, 120-day note payable that is due on April 17, 2022.

An estimated income tax payment of $60,000 will be made in May. The regular quarterly dividend of $24,000 is expected to be declared in May and paid in June. Capital expenditures amounting to $25,800 will be made in April.

Required:

1. Complete the monthly cash budgets for the second quarter of 2022 using the following format. Note that the ending cash balance for June is provided as a check figure.
2. Assume that management of SeaTech Incorporated desires to maintain a minimum cash balance of $18,500 at the beginning of each month and has arranged a $100,000 line of credit with a local bank at an interest rate of 10% 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 $18,500 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.

SEATECH INCORPORATED Cash Budget For the months of April, May, and June 2022 \begin{tabular}{|l|l|l|l|} \hline & & April & May \\ \hline Beginning cash balance & & & \\ \hline Cash Receipts: & & & \\ \hline From cash sales made in current month & & & \\ \hline From credit sales made in February & & & \\ \hline From credit sales made in March & & & \\ \hline From credit sales made in April & & & \\ \hline From credit sales made in May & & \\ \hline Total cash available & & \\ \hline Cash Disbursements: & & \\ \hline For cost of goods sold/operating expenses incurred in March & & \\ \hline For cost of goods sold/operating expenses incurred in April & & \\ \hline For cost of goods sold/operating expenses incurred in May & & \\ \hline For cost of goods sold/operating expenses incurred in June & & \\ \hline For payment of note payable and interest & & \\ \hline For capital expenditures & & \\ \hline For payment of income taxes & & \\ \hline For payment of dividends & & \\ \hline Total disbursements & & \\ \hline Ending cash balance & & \\ \hline \end{tabular} Assume that management of SeaTech Incorporated desires to maintain a minimum cash balance of $18,500 at the beginning of each month and has arranged a $100,000 line of credit with a local bank at an interest rate of 10% to ensure the availability of funds. Borrowing transactions are to occur only at the end of month in which the budgeted cash balance would otherwise fall short of the $18,500 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. Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollars. Use 360 days year for calculations