Problem 14-20A (Algo) Preparing a cash budget LO 14-5

Munoz Medical Clinic has budgeted the following cash flows.

	January	February	March
Cash receipts	$	110,000		$	116,000		$	136,000
Cash payments
For inventory purchases		95,000			77,000			90,000
For S&A expenses		36,000			37,000			32,000

Munoz Medical had a cash balance of $13,000 on January 1. The company desires to maintain a cash cushion of $9,000. Funds are assumed to be borrowed, in increments of $1,000, and repaid on the last day of each month; the interest rate is 2 percent per month. Repayments may be made in any amount available. Munoz 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 last years quarterly results.

Required

Prepare a cash budget. (Round intermediate and final answers to the nearest whole dollar amounts. Any repayments should be indicated with a minus sign.)

Prepare a cash budget. (Round intermediate and final answers to the nearest whole dollar amounts. Any repayments should be indicated with a minus sign.)