7.3 Calculate the amount that is budgeted for Interim Dividends (labelled F). Additional Information: 1. Total sales for the Budget period is expected to be as follows: January February March April May June 2. 3. 4. 5. 324 000 346 000 360 000 480 000 330 000 ? Cash sales are expected to be 40% of total sales for the entire budget period. Debtors are expected to pay as follows: 50% pay in the same month as the sales transaction (less 5% discount) 30% pay in the month after the sales transaction month 15% pay in the second month after the sales transaction month 5% are expected to be bad and are written off in the third month after the transaction. The current mark-up is 60% on cost. A fixed base stock of raw materials is kept at all times. All raw materials are bought on credit. Creditors are paid in the month following the purchase of stock (i.e. within 30 days) to earn a 10% discount At the end of the financial year ended 28 February 2021, the return on total capital employed was 5% Mkhize Manufacturers Ltd has an authorised share capital of 1 000 000 ordinary shares. 520 000 ordinary shares valued at R3 020 000, were in issue on 1 March 2020, the beginning of the financial year. New shares will be issued on 1 January 2021 at R6.50 per share. 60 000 shares will be repurchased for R7.15 per share during the budgeted period. 6. 7. 8. Mkhize Manufacturers Ltd aims to pay an interim dividend of 80 cents per share to its shareholders during June 2021. Mbatha LTD Nam: Cash Budget for the six period January to June 2021 May June April Receipts March Feb Jan 148 800 132 000 192 000 Cash sales 129 600 144 000 138 400 ? ? ? Collection from debtors 2 188 700 194 370 0 0 0 Issue of shares 0 0 1 300 000 0 80 000 0 Sale of Factory Equip 0 0 0 ? ? Total Receipts 332 770 1 618 300 ? ? PAYMENTS Directors Fees 66 000 66 000 66 000 66 000 66 000 66 000 Interest on loan (8% p.a.) 5 600 5 600 4 200 4 200 4 200 2 700 Repayment of loan 0 0 D 0 0 E Repurchase of Shares O 0 O ? o O Interim dividends paid 0 0 0 0 0 F Maintenance of Factory Equip 12 000 12 000 12 000 12 000 2 000 2 000 Electricity (80% for factory) 8 000 8 000 8 000 8 000 6 500 6 500 Deposit on new Factory Equip 0 O 0 0 150 000 0 Instalments on new factory Equip (incl finance charges) 0 0 0 0 O 16 000 Independent auditors fees o 0 0 60 000 0 0 Total Payments ? ? ? ? ? ? Cash Surplus / Deficit ? ? ? ? ? ? Cash Balance at the beginning of the period ? ? ? ? ? ? Cash Balance at the end of the period