Prepare cash budget for the months of January, February and March.
· The difference between receipts and payments, net cash flow, for each month is: 5,000; (2,900); 7,200.
· Beginning and desired cash balance is $2,000.
· The company invests excess cash in marketable securities which are sold before borrowing money. The balance as of end of December is zero.
· Outstanding loans at the end of month of December $3,000.