The following information pertains to Alpha Projects for the quarter ended 31 December: Actual Budgeted November...
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The following information pertains to Alpha Projects for the quarter ended 31 December: Actual Budgeted November December October R R R Invoices (20% for cash and 80% on credit) 360 000 380 000 400 000 Purchases (10% for cash 90% on credit) 240 000 280 000 320 000 Salaries and wages paid Cash expenses Depreciation 40 000 60 000 60 000 24 000 28 000 32 000 2000 2000 2000 Additional Information: 1. It is expected that debtors will settle their accounts as follows: 20% in the month of invoice 70% in the month after the month of invoice, and 5% in the second month after the month of invoice. The remaining 5% is usually written off as bad debts. 2. Trade creditors are paid in the month after the purchases at a discount of 5%. 3.50% of the salaries and wages are weekly wages. Because wages are paid weekly, usually 10% of the wages are paid in the month following the month in which they were incurred. 4. Expenses are paid as they arise. 5. The favourable bank balance on 1 November was R 13 600. Required: Prepare the Cash Budget of Alpha Projects for November and December. The following information pertains to Alpha Projects for the quarter ended 31 December: Actual Budgeted November December October R R R Invoices (20% for cash and 80% on credit) 360 000 380 000 400 000 Purchases (10% for cash 90% on credit) 240 000 280 000 320 000 Salaries and wages paid Cash expenses Depreciation 40 000 60 000 60 000 24 000 28 000 32 000 2000 2000 2000 Additional Information: 1. It is expected that debtors will settle their accounts as follows: 20% in the month of invoice 70% in the month after the month of invoice, and 5% in the second month after the month of invoice. The remaining 5% is usually written off as bad debts. 2. Trade creditors are paid in the month after the purchases at a discount of 5%. 3.50% of the salaries and wages are weekly wages. Because wages are paid weekly, usually 10% of the wages are paid in the month following the month in which they were incurred. 4. Expenses are paid as they arise. 5. The favourable bank balance on 1 November was R 13 600. Required: Prepare the Cash Budget of Alpha Projects for November and December.
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To prepare the cash budget for Alpha Projects for November and December we need to consider the cash ... View the full answer
Related Book For
Financial Reporting and Analysis
ISBN: 978-0078025679
6th edition
Authors: Flawrence Revsine, Daniel Collins, Bruce, Mittelstaedt, Leon
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