Belly Dealers prepared the following figures: Credit sales: January R990 000 February R1 080 000 March R832
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Question:
Belly Dealers prepared the following figures:
Credit sales:
January R990 000
February R1 080 000
March R832 500
April R1 228 500
May R783 000
Additional information:
- Credit sales are collected as follows:
- 30% within the month of sale
- 40% in the month following sales
- 29% in the second month following sale
- The balance is uncollectable
- Purchases equals to 45% of the sales value and paid; 70% in the month of purchase and balance in the month after purchases.
- Office salaries are paid by the end of the month. Office salaries for January amounts to R18 000 and are expected to increase by 7% each month up to and including March.
- A second hand delivery truck costing R150 000 is to be purchased in March. A deposit of 15% of the purchased price must be paid for in the month of purchase and the balance in three equal instalments, commencing from the month following purchase.
- Rent of R7 000 per month is payable
- Rates and taxes amounts to R2 500 monthly and are payable at the end of the month.
- At the end of March, the business had an unfavorable balance of R70 000
Required:
Prepare a cash budget for the month of April and May, clearly show your calculations.
NB: Round off calculations to the nearest amount. Indicate negative amount by means of brackets.
Debtors collection schedule
April | May | |
collection | ||
Collection | ||
Collection |
Creditors payment schedule
April | May | |
Payment | ||
Payment |
Cash budget for April and May
April | May | |
Opening balance | ||
Collection from debtors | ||
Purchases | ||
Salaries | ||
Vehicle | ||
Rent | ||
Rates | ||
Closing balance |
Related Book For
Posted Date: