IE Exercise $20-17($Algo$)$: Preparation of cash budgets $($for three periods$)$ LO P$2$

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.

Kayak requires a minimum cash balance of $$40,000$ at each month$-$end. Loans taken to meet this requirement charge $0\mathrm{.}6\%$ 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 $1.$

Prepare monthly cash budgets for January, February, and March.