Question:
From the following information of Moon Ltd, prepare a Cash Budget for the 3 months commencing on 1 June 2010, when the Bank Balance was Rs. 10,000:
|
Months
|
Sales
Rs.
|
Purchases
Rs.
|
Wages
Rs.
|
Selling Expenses
Its.
|
Overheads
Rs.
|
|
April
|
1,00,000
|
70,000
|
8,500
|
3,500
|
4,000
|
|
May
|
1,20,000
|
80,000
|
9,500
|
3,500
|
4,500
|
|
June
|
1,40,000
|
90,000
|
9,500
|
3,500
|
6,000
|
|
July
|
1,60,1300
|
1,00,000
|
12,000
|
3,500
|
6,500
|
|
August
|
1,80,000
|
1,10,000
|
14,000
|
3,500
|
7,000
|
A commission of 5% on the sales due of 2 months after the sales is payable in addition to the above selling expenses. Credit terms of sale are-payment by the end of the month following the month of supply. On an average, one-half of sales is paid on the due date, while the other half is paid during the next month. Creditors are paid during the month following the month of supply. The plant is purchased in June. Rs. 78,000 is payable on delivery. Rs. 48,000 and the balance in two equal monthly instalments in July and in August. A dividend of Rs. 30,000 will be paid in September. Wages are paid 3/4th on due date while 1/4th on during the next month. The lag in payment of Selling Expenses and Overheads is 1 month.