4.12 Cash The following bodgesed Profit and Loss Account has been prepared for Company B for the first six months of the coming year. Jan Feb Mar B April Ra May Re Ju R Sales 25,000 24,000 25,000 2,000 1,000 23.000 Less cons Materials 8,000 9,000 Labour 3,900 4,000 Overheads 4,600 4,700 16,500 17,700 18,600 9,500 10,000 6,000 1,500 4,200 4,700 3,700 4,100 4,900 5,300 4,500 3,800 19,900 13,500 17,100 Profit 5.500 6,300 6,400 9,100 4.500 5,500 The material cost above is arrived at as follows Opening steck 3,000 5,000 3,000 2,500 3,500 1,500 Purchases 10,000 7,000 9,000 11,000 4,000 11,000 13,000 Closing stock 5,000 3,000 12,000 12,000 2,500 13,500 7,500 12,500 3.500 1,500 4,000 8,000 9,000 9,500 10,000 6,000 8,500 Notez we chels All materials are paid for one month after delivery. December purchases were Rs 9,000 (i) Customers are expected to pay two months after sale. Sales for the previous November were Rs 18,000 and for December Rs 19,000 (ii) Labour costs are paid in the month wages are earsed. (v) Included in the overhead figure is Rs 1,000 per month for depreciation-all other overhead costs are paid for in the month the cost is incurred. -() Capital expenditure is planned for March of Rs 7,500 and Jone Rs 27,200 (vi) A tax payment is due in January of Rs 8,000. (vi) The expected cash balance at the beginning of January is Rs 2,000. Required: (A cash budget for the first six months of the coming year. (i) Discuss the action the firm should take in view of the cash budget you have prepared. of for day day May of th