a 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. January February March Cash Receipts Cash payments $ 522,000 09,000 471,000 $ 469,900 356,900 531,000 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. Prepare monthly cash budgets for January, February, and March. Note: Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Beginning cash balance Add: Cash receipts Total cash available Less: Cash payments for Interest revenue Cash receipts Total cash payments Preliminary cash balance Loan activity KAYAK COMPANY Cash Budget January February March $ 40,000 $ 40,000 522,000 409,000 471,000 562,000 449,000 0 0 0
a 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. January February March Cash Receipts Cash payments $ 522,000 09,000 471,000 $ 469,900 356,900 531,000 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. Prepare monthly cash budgets for January, February, and March. Note: Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Beginning cash balance Add: Cash receipts Total cash available Less: Cash payments for Interest revenue Cash receipts Total cash payments Preliminary cash balance Loan activity KAYAK COMPANY Cash Budget January February March $ 40,000 $ 40,000 522,000 409,000 471,000 562,000 449,000 0 0 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Vinubhai
Transcribed Image Text:a
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.
January
February
March
Cash Receipts Cash payments
$ 522,000
09,000
471,000
$ 469,900
356,900
531,000
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.
Prepare monthly cash budgets for January, February, and March.
Note: Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.
Beginning cash balance
Add: Cash receipts
Total cash available
Less: Cash payments for
Interest revenue
Cash receipts
Total cash payments
Preliminary cash balance
Loan activity
KAYAK COMPANY
Cash Budget
January
February
March
$
40,000 $
40,000
522,000
409,000
471,000
562,000
449,000
0
0
0
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