Walton Medical had a cash balance of $17,000 on January 1. The company desires to maintain a cash cushion of $5,000. Funds are assumed to be borrowed, in increments of $1,000, and repaid on the last day of each month; the interest rate is 1 percent per month. Repayments may be made in any amount available. Walton 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 this years quarterly results. Required Prepare a cash budget.

Walton Medical Clinic has budgeted the following cash flows. January $118,000 February March $124,000 $144,000 Cash receipts Cash payments For inventory purchases For S&A expenses 99,000 40,000 81,000 41,000 94,000 36,000 Walton Medical had a cash balance of $17,000 on January 1. The company desires to maintain a cash cushion of $5,000. Funds are assumed to be borrowed, in increments of $1,000, and repaid on the last day of each month; the interest rate is 1 percent per month. Repayments may be made in any amount available. Walton 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 this year's quarterly results. Required Prepare a cash budget. (Round intermediate and final answers to the nearest whole dollar amounts. Any repayments/shortage should be indicated with a minus sign.) Answer is complete but not entirely correct. January February March $ 17,000 $ $ 118,000 Cash Budget Section 1: Cash Receipts Beginning cash balance Add: Cash receipts Total cash available Section 2: Cash Payments For inventory purchases For S&A expenses Interest expense per month 6,400 124,000 130,400 6,900 144,000 150,900 135,000 99,000 40,000 (400) 81,000 41,000 (500) 94,000 36,000 (470) X 138,600 121,500 129,530 Total budgeted disbursements Section 3: Financing Activities Surplus (shortage) Borrowing (repayment) Ending cash balance (3,600) 10,000 6,400 8,900 (2,000) X 6,900 $ 21,370 (13,000) 8,370 $