Question:
Prepare a Cash Budget for the 3 months that ended on 31 March 2010, on the basis of the following information:
|
|
|
Cash Balance on 1 January 2010
|
25,000
|
|
Estimated monthly salaries and wages
|
10,000
|
|
Interest payable in February 2010
|
5,000
|
|
Estimated
|
December
Rs.
|
January
Rs.
|
February
Rs.
|
March
Rs.
|
|
Cash Sales
|
-
|
1,40,000
|
1,52,000
|
1,21,000
|
|
Credit Sales
|
1,00,000
|
80,000
|
1,40,000
|
1,20,000
|
|
Purchases
|
1,60,000
|
1,70,000
|
2,40,000
|
1,80,000
|
|
Other Expenses
|
-
|
20,000
|
22,000
|
21,000
|
Cash Sales are collected 50% in the month in which the sales are made and 50% in the following month.Collections from the Credit Sales are subject to 5% discount if the payment is received during the month of sale and 2 % if the payment is received in the following month.
Creditors are paid either on a 'prompt' or 30-day basis. It is estimated that 10% of Creditors are in the 'prompt' category