Chapter 20 Homework i Saved Help Save & Exit Submit Check my work 19 Exercise 20-17 (Algo) Preparation of cash budgets (for three periods) LO P2 points Kayak Company budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year. Cash Receipts Cash payments January $ 528, 000 $ 469, 300 Book February 407, 500 348, 800 March 467,060 532,000 Hint Kayak requires a minimum cash balance of $40,000 at each month-end. Loans taken to meet this requirement charge 1%, interest per month, paid at each month-end. The interest is computed based on the beginning balance of the loan for the month. Any preliminary cash balance above $40,000 is used to repay loans at month-end. The company has a cash balance of $40,000 and a loan balance of $80,000 at January 1. Ask Prepare monthly cash budgets for January, February, and March. Note: Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Print KAYAK COMPANY Cash Budget References January February March Beginning cash balance 40,000 40,000 Add: Cash receipts 528,000 407,500 467,000 Total cash available 568,000 447,50 Less: Cash payments for All items excluding interest 469,300 348,800 532,000 Interest on loan 800 Total cash payments 470, 100 348,800 532,000 Preliminary cash balance 97,900 Loan activity Additional loan (loan repayment) Ending cash balance $ 40,000 $ 40,000 Loan balance Loan balance - Beginning of month $ 80,000 $ 22, 100 $ Additional loan (loan repayment) Loan balance, end of month $ 22, 100 $ of Mc Graw