Question: QUESTION 4 ( 2 0 Marks ) REQUIRED Use the information provided below to prepare the Cash Budget for August, September and October 2 0

QUESTION 4(20 Marks) REQUIRED Use the information provided below to prepare the Cash Budget for August, September and October 2025. INFORMATION The following information relates to Joanus Manufacturers which will commence business on 01 August 2025 with a capital contribution of R200000 cash, manufacturing a product called Jetta: 1. Machinery and equipment will be purchased on credit on 01 August 2025 for R200000. A deposit of 20% will be paid upon purchase and the balance will be paid in five equal monthly instalments commencing September 2025.2. Production units for each month are expected to exceed the following months estimated sales units by 20%. Production will commence on 02 August 2025.3. Estimated sales at R50 per unit are as follows: Units August 0 September 7000 October 8000 November 90004. Cash sales are forecasted at 60% of the total sales. The balance of the sales will be on credit and the customers are expected to pay in the month after the sale. (Separate entries are required for cash sales and collections from credit sales.)5. Variable manufacturing costs per unit are as follows: Direct materials R12 Direct labour R7 Variable overheads R56. Direct materials will be purchased for cash for the production requirements of each month. 7. Direct workers will have their salaries paid on the last working day of each month. 8. Fixed overheads amount to R10000 per month and this includes depreciation of R1000 per month. Fixed and variable overheads are paid in the month after they are incurred. (Separate entries are required for fixed and variable overheads)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!