Coronado Company expects to have a cash balance of $41,400 on January 1, 2022. Relevant monthly budget data for the first 2 months of 2022 are as follows.
Collections from customers: January $78,200, February $138,000.
Payments for direct materials: January $46,000, February $69,000.
Direct labor: January $27,600, February $41,400. Wages are paid in the month they are incurred.
Manufacturing overhead: January $19,320, February $23,000. These costs include depreciation of $1,380 per month. All other overhead costs are paid as incurred.
Selling and administrative expenses: January $13,800, February $18,400. These costs are exclusive of depreciation. They are paid as incurred.
Sales of marketable securities in January are expected to realize $11,040 in cash. Coronado Company has a line of credit at a local bank that enables it to borrow up to $23,000. The company wants to maintain a minimum monthly cash balance of $18,400.
Prepare a cash budget for January and February.