ABC PLC produces and sells a branded product. The following productions and sales forecasts for the month of June, July, August and September 2020 were extracted from the records of the company: June July August September Purchases (in units) 8,000 12,000 15,000 13,000 Sales (in units) 9,000 10,000 14,000 13,000 The following additional information is also provided:

a. Purchase price per unit is Rs.80. All the purchases are made on credit basis and payments will be made in the following month. 7

b. 60% of the sales are on cash basis and balance will be collected in the following month. Selling price per unit is Rs.120.

c. Total administration and distribution expenses for the month have been estimated to be Rs. 480,000 and it will be paid in the same month.

d. The company intends to obtain a bank loan of Rs. 1,000,000 during the month of August 2020 to be settled in monthly installments of Rs. 60,000 each for a period of 2 years. First installment will be paid on 01st September 2020