I ON A monthly sales, production and overheads (including depreciation) are expected co is going to start trading on 1st Jul 2021. During the first 6 months of trading follows: Sale (Units) Production (Units) Jul 25,000 30,000 Aug 21,000 30,000 Sep 22,000 40,000 Oct 28,000 40,000 Nov 36,000 50,000 Dec 41,000 50,000 Overheads (E) (Including Depreciation) 30,000 30,000 40,000 40,000 50,000 50,000 4. 3. Extra information includes: 1. 2. The company is expected to have 550,000 cash at bank on 1st July 2021. (A machine was purchased for 150,000 and is to be paid in cash on 1st Jul 2021. The machine will have a useful life of 8 years and a residual value of 6,000 at the end. The selling price of the product will be 21 per unit. The sales are expected to be 40% in cash and 60% in 1 -month credit. A 2% discount is given to the customers who paid in cash. Purchases of raw materials will be 7 per unit on 2-month credit.. 5. The labour cost will be 4 per unit, to be paid in the month concerned. 6. Overheads are planned to be paid 80% in the month of production and 20% in the following month. Required: (a) Prepare a monthly cash budget for the period July-December 2021. (20 marks) (b) Discuss sources of finance for working capital. (5 marks)