Please answer the below with steps on how the answer was obtained. Required the information provided below
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Please answer the below with steps on how the answer was obtained.
Required | ||
the information provided below to prepare the following for Mustang Enterprises for January and February 2024. | ||
3.1 | Debtors Collection Schedule | |
3.2 | Cash Budget. | |
Information | ||
The following information was supplied by Mustang Enterprises: | ||
1. | Mustang Enterprises expects to have an unfavourable bank balance of R40 000 on 31 December 2023. | |
2. | The monthly sales were projected as follows: | |
2023 | Units | |
November | 44000 | |
December | 53000 | |
2024 | Units | |
January | 47000 | |
February | 31000 | |
3. | The selling price is R20 per unit (excluding any discounts). All the goods produced each month are expected to be sold in the same month. Sixty percent (60%) of the sales is expected to be on credit and the balance is for cash. Thirty percent (30%) of the cash sales is subject to a discount of 10%. | |
4. | Credit sales are usually collected as follows: | |
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5. | Manufacturing overheads are paid monthly. The overheads are expected to amount to R65 000 for December 2023, including R5 000 for depreciation. Manufacturing overheads are expected to increase by 5% each month. | |
6. | Labour costs amount to R6 per unit and are paid in the month in which they are incurred. Labour costs per unit are expected to increase by 9% with effect from 01 February 2024. | |
7. | Materials cost R7 per unit (excluding any discounts). All the materials are purchased for cash to take advantage of a discount of 7.5%. | |
8. | R200 000 is expected to be invested in a fixed deposit account on 01 February 2024.Interest at 9% per annum is receivable monthly, commencing February 2024. | |
9. | Selling and administrative costs are paid monthly and are expected to total R56 000 for February 2024, after an increase of 12% takes place on 01 February 2024. |
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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