Kayak Co. 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. January February March Cash Receipts $521,000 403,500 462,000 Cash payments $466,700 349,200 534,000 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 $150,000 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 KAYAK COMPANY Cash Budget For January, February, and March January February Beginning cash balance $ 40,000 $ 40,000 $ Cash receipts 521,000 403,500 Total cash available 561,000 443,500 Cash payments (466,700) (349,200) interest expense (800) (265) Preliminary cash balance 93,500 94,035 Additional loan (loan repayment) (53,500) (26,500) Ending cash balance $ 40,000 $ 67,535 $ Loan balance 67,535 462,000 529,535 (534,000) 0 (4,465) YYYYY 40,000 $ 80,000 $ 26,500 $ 0 Loan balance - Beginning of month Additional loan (loan repayment) Loan balance - End of month (53,500) 26,500 (26,500) 0 $ $ Electro Company manufactures an innovative automobile transmission for electric cars. Management predicts that ending finished goods inventory for the first quarter will be 135,200 units. The following unit sales of the transmissions are expected during the rest of the year: second quarter, 338,000 units; third quarter, 363,000 units; and fourth quarter, 364,500 units. Company policy calls for the ending finished goods inventory of a quarter to equal 40% of the next quarter's budgeted sales. Prepare a production budget for both the second and third quarters that shows the number of transmissions to manufacture. ELECTRO COMPANY Production Budget Second and Third Quarters Second Quarter Third Quarter Budgeted ending inventory (units) Budgeted unit sales for quarter Required units of available production Budgeted beginning inventory (units) Units to be produced