Exercise: Prasad & Co. wishes to prepare cash budget from January. Prepare a cash budget for the first six months from the following estimated revenue and expenses: Month Total Sales OMR. Materials OMR. Selling and Distribution Overheads OMR. Wages OMR. Production Overheads OMR. January 10,000 10,000 2,000 1,600 400 February 11,000 7,000 2,200 1,650 450 March 14,000 7,000 2,300 1,700 450 April 15,000 11,000 2,300 1,750 500 May 15,000 10,000 2,000 1,600 450 June 20,000 12,500 2,500 1,500 600 Additional Information 1. Cash balance on 1st January was OMR. 5,000. A new machinery is to be installed at OMR. 10,000 on credit, to be repaid by two equal installments in March and April. 2. Sales commission @ 5% on total sales is to be paid within a month of following actual sales. 3. OMR. 5,000 being the amount of 2nd call may be received in March. Share Premium amounting to OMR 1,000 is also obtainable with the 2nd call. 4. Period of credit allowed by suppliers - 2 months. 5. Period of credit allowed to customers 1 month. 6. Delay in payment of overheads 1 month. 7. Delay in payment of wages -I month. 8. Assume cash sales to be 50% of total sales