QUESTION $4(20$ Marks$)$

REQUIRED

Use the information given below to prepare the following for January, February and March $2025$:

$4\mathrm{.}1$ Debtors Collection Schedule $(6$ marks$)$

$4\mathrm{.}2$ Cash Budget. $(14$ marks$)$

INFORMATION

The following data and estimates are available for Dunlop Limited for the period $01$ December $2024$

to March $2025$:

December $2024$ January $2025$ February $2025$ March $2025$

Credit sales R$100000$ R$170000$ R$190000$ R$230000$

Wages R$130000$ R$150000$ R$186000$ R$184000$

Fixed overheads R$64000$ R$64000$ R$64000$ R$64000$

Variable overheads R$40000$ R$76000$ R$84000$ R$101000$

Direct materials R$102000$ R$114000$ R$94000$ R$104000$

Additional information

$1.$ Seventy five percent $(75\%)$ of the sales is expected to be for cash and the balance on credit.

Collections from credit sales are as follows:

$40\%$ in the month of the sale

$60\%$ in the month after the sale.

$2.$ Since wages are paid on specific days, only $80\%$ of a month$$s budgeted wages are paid in that

month. The rest is paid in the following month.

$3.$ Fixed overheads are paid in the month in which they are incurred.

$4.$ Payment of the variable overheads is delayed by one month.

$5.$ Sixty percent $(60\%)$ of the direct materials will be purchased for cash and the rest on credit.

Creditors are paid in the month after the purchase.

$6.$ A loan of R$400000$ is to be obtained on $31$ March $2025$ to finance the expansion of the business

commencing April $2025.$

$7.$ The cash balance on $01$ January $2025$ is expected to be R$75000($unfavourable