Royal Industries has budgeted the following information for January:

Cash Receipts	$ 41,000
Beginning Cash Balance	$ 20,000
Cash Payments	$ 51,100
Desired Ending Cash Cushion	$ 15,000

If there is a cash shortage, the company borrows money. If a surplus occurs, funds are used to repay loans or to invest in short-term assets. All borrowing, repayments, and interest payments occur on the last day of the month. The company had no debt before January 1. The interest rate is 2.00% per month. The amount of interest expense incurred for January is:

Multiple Choice

$198.00.

$102.00.

$300.00.

None of these answers is correct.