Royal Industries has budgeted the following information for January: Cash Receipts $ 40,000 Beginning Cash Balance $ 10,000 Cash Payments Desired Ending Cash Cushion $ 48,000 $ 5,000 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 interest rate is 1% per month. The company had no debt before January 1. The amount of interest expense incurred for January is: