Problem
Kalou Medical Clinic has budgeted the following cash flows.
January, February, March
Cash receipts $120,000 $116,000 $136,000
Cash payments
For inventory purchases 110,000 82,000 95,000
For S&A expenses 31,000 32,000 27,000
Kalou Medical had a cash balance of $8,000 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. Kalou pays its vendor 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 all computations to the nearest whole dollar.)