QUESTION $4$

$(20$ Marks$)$

REQUIRED

Prepare the following for April, May and June $2025$:

$4\mathrm{.}1$

Debtors Collection Schedule

$(6$ marks$)$

$4\mathrm{.}2$

Cash Budget.

$(14$ marks$)$

Note: The items that comprise General and administrative expenses must be shown separately.

INFORMATION

Bentall Limited is a retail outlet that is formulating its plans for the first half of $2025.$ The following information is available:

$1.$

The figures below show the expected sales values of the products $($excluding discounts$)$:

$2025$

R

January

$900000$

February

$945000$

March

$990000$

April

$1035000$

May

$915000$

June

$1020000$

$2.$

Seventy percent $(70\%)$ of the sales is for cash and the balance is on credit. Customers who purchase for cash are entitled to a discount of $10\%.$ Forty percent $(40\%)$ of the credit sales is usually collected in the month of the sale and these debtors receive a $5\%$ discount. The balance is collected in the month after the sale.

$3.$

The products are sold at cost plus $50\%$ and a fixed inventory level of R$150000$ is maintained at the end of each month. All purchases are on credit and creditors are paid three months after the purchase.

$4.$

Labour costs are estimated to equal $10\%$ of the current month$$s sales $($excluding discounts$).$ These are paid for in the applicable month.

$5.$

General and administrative expenses are projected to be R$792000$ for $2025.$ Except for property taxes and directors$$ fees all other expenses are incurred evenly throughout the year. Property taxes are paid in four equal instalments in the last month of each quarter. Directors$$ fees are expected to increase by $10\%$ with effect from $01$ May $2025.$ General and administrative expenses comprise the following:

R

Directors$$ fees

$144000$

Advertising

$198000$

Property taxes

$72000$

Insurance

$108000$

Electricity and water

$90000$

Depreciation

$180000$

Total

$792000$

$6.$

A company tax payment will be made on $01$ April $2025$ based on $50\%$ of the estimated profit of R$300000$ for the financial year. The company$$s tax rate is $27\%.$

$7.$

The closing bank balance on $31$ March $2025$ is expected to be R$15000$