A company expects to have Rs. 37,500 cash in hand on 1st April, and requires you...

 

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A company expects to have Rs. 37,500 cash in hand on 1st April, and requires you to prepare an estimate of cash position during the three months, April, May and June. The following information is supplied to you: Sales Purchases Wages Factory Office Selling expenses Rs. expenses Rs. expenses Rs. Rs. Rs. Rs. February March 75,000 84,000 9,000 9,750 10,500 13,500 14,250 7,500 8,250 6,000 6,000 45,000 4,500 48,000 52,000 60,000 4,500 April Мay June 6,000 6,000 7,000 5,250 6,570 7,000 90,000 9,000 11,250 1,20,000 1,35,000 60,000 14,000 Other information : 1. Period of credit allowed by suppliers - 2 months. 2. 20 % of sales is for cash and period of credit allowed to customers for credit is one month. 3. Delay in payment of all expenses - 1 month. 4. Income tax of Rs. 57,500 is due to be paid on June 15th. 5. The company is to pay dividends to shareholders and bonus to workers of Rs. 15,000 and Rs. 22,500 respectively in the month of April. 6. Plant has been ordered to be received and paid in May. It will cost Rs. 1,20,000. A company expects to have Rs. 37,500 cash in hand on 1st April, and requires you to prepare an estimate of cash position during the three months, April, May and June. The following information is supplied to you: Sales Purchases Wages Factory Office Selling expenses Rs. expenses Rs. expenses Rs. Rs. Rs. Rs. February March 75,000 84,000 9,000 9,750 10,500 13,500 14,250 7,500 8,250 6,000 6,000 45,000 4,500 48,000 52,000 60,000 4,500 April Мay June 6,000 6,000 7,000 5,250 6,570 7,000 90,000 9,000 11,250 1,20,000 1,35,000 60,000 14,000 Other information : 1. Period of credit allowed by suppliers - 2 months. 2. 20 % of sales is for cash and period of credit allowed to customers for credit is one month. 3. Delay in payment of all expenses - 1 month. 4. Income tax of Rs. 57,500 is due to be paid on June 15th. 5. The company is to pay dividends to shareholders and bonus to workers of Rs. 15,000 and Rs. 22,500 respectively in the month of April. 6. Plant has been ordered to be received and paid in May. It will cost Rs. 1,20,000.

Answer rating: 100% (QA)

1 Cash Budget April May and June April May June Beginning Cash Balance 37500 11700 91050 Cash receip... View the full answer