Kraft budgeted sales are $10,000 per month and let's assume the sales stay the same every month. Its customers pay Kraft based on the following pattern: 20% will pay in the month of sales and take a 3% discount, the remaining customers pay in the month following the sale and take a 1% discount (even though they shouldn't). Kraft has no bad debt on its collection. Kraft inventory purchase every month is based on 30% of next month's projected sales and it pays for the inventory purchase immediately. "Other payments," which include salaries, rent and supplies, are always 45% of sales for the month. Construct a cash budget for a typical month (Hint: ignore the first month, what does the monthly cash budget look like for month 2 or month 3). What is the average cash gain or loss during the month?

a) -$2,180

b) $2,750

c) $1,740

d) $2,360