16 Illustration 1 Prepare a cash budget for the month of May, June and July 1979 on the basis of the following information : (1) Income and Expenditure Forecasts. Wages Month Credit Credst Sales Purchases Rs. Rs. Manu- facturing Expenses Rs. Office Selling Expenses Expenses Rr RS. Rs. March April May June July August 60,000 36,000 62,000 38.000 64,000 33,000 58,000 35,000 56,000 39,000 60,000 34,000 9,000 8,000 10,000 8.500 9,500 8,000 4,000 3,000 4.500 3,500 4,000 3,000 2,000 1,500 2,500 2,000 1,000 1.500 4,000 5,000 4,500 3,500 4,500 4.500 (2) Cash balance on 1st May, 1979 Rs. 8,000. (3) Plant costing Rs. 16,000 is due for delivery in July, payable 10% on delivery and the balance after 3 months. (4) Advance Tax of Rs. 8,000 each is payable in March and June. (5) Period of credit allowed (0) by suppliers--two months and (ii) to customers-one month (6) Lag in payment of manufacturing expenses- month. (7) Lag in payment of office and selling expenses-one month