Kayak Co. 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 Cash Receipts $523,000 404,500 482,000 paynents $467,600 349,100 531,000 January February March According to a credit agreement with its bank, Kayak requires a minimum cash balance of $40,000 at each month-end, In return, the bank has agreed that the company can borrow up to $160,000 at a monthly interest rate of 196, paid on the last day of each month. TH interest is computed based on the beginning balance of the loan for the month. The company repays loan principal with any cash in excess of $40,000 on the last day of each month. 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. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Kayak Co. 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
Cash
January
February
March
Receipts
$523,000
404,500
482,000
payments
$467,600
349,100
531,000
According to a credit agreement with its bank, Kayak requires a minimum cash balance of $40,000 at each month-end, in return, the
bank has agreed that the company can borrow up to $160,000 at a monthly interest rate of 19%, paid on the last day of each month. The
interest is computed based on the beginning balance of the loan for the month. The company repays loan principal with any cash in
excess of $40,000 on the last day of each month. The company has a cash balance of $40,000 and a loan balance of $80,00 at
January 1.
Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should
be indicated with minus sign.)
KAYAK COMPANY
Cash Budget
For January, February, and March
January
February
March
Beginning cash balance
Cash receipts
40,000$
40.000
523,000
404,500
482.000
Total cash available
563,000
444 500
Cash payments
467,600
349,100
531.000
finterest expense
800r
Transcribed Image Text:Kayak Co. 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 Cash January February March Receipts $523,000 404,500 482,000 payments $467,600 349,100 531,000 According to a credit agreement with its bank, Kayak requires a minimum cash balance of $40,000 at each month-end, in return, the bank has agreed that the company can borrow up to $160,000 at a monthly interest rate of 19%, paid on the last day of each month. The interest is computed based on the beginning balance of the loan for the month. The company repays loan principal with any cash in excess of $40,000 on the last day of each month. The company has a cash balance of $40,000 and a loan balance of $80,00 at January 1. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) KAYAK COMPANY Cash Budget For January, February, and March January February March Beginning cash balance Cash receipts 40,000$ 40.000 523,000 404,500 482.000 Total cash available 563,000 444 500 Cash payments 467,600 349,100 531.000 finterest expense 800r
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