Gibson Medical Clinic has budgeted the following cash flows: January February March Cash receipts $ 108,000 $ 114,000 $ 134,000 Cash payments For inventory purchases 94,000 76,000 89,000 For S&A expenses 35,000 36,000 31,000 Gibson Medical had a cash balance of $12,000 on January 1. The company desires to maintain a cash cushion of $7,000. Funds are assumed to be borrowed, in increments of $1,000, and repaid on the last day of each month; the interest rate is 3 percent per month. Repayments may be made in any amount available. Gibson pays its vendors on the last day of the month also. The company had a monthly $40,000 beginning balance in its line of credit liability account from this years quarterly results.

prepare a cash budget