Jefferson Ltd is a small retail business that operates in the United Kingdom. The company was formed in December 2015 and commenced its new year on 1 January 2016 with

25,000 in share capital. Jefferson Ltd also has 6,000 in the bank and 15,000 of finished goods stock for resale. This information had already been recorded in the accounting records of Jefferson Ltd.

The company has agreed a bank overdraft facility of up to 15,000.

The following transactions had been budgeted for the first 6 months of 2016.

Sales of goods to debtors in the 6 months to June 2016 were expected to be 160,000 in total, and transacted as follows:

		Jan	Feb	Mar	Apr	May	Jun
Sales		20,000	18,000	20,000	25,000	32,000	45,000

Gross profit margins are always 35% of sales and it was Jefferson Ltds policy to have sufficient finished goods stock at the end of each month to service the following months cost of sales. The sales forecast for July 2016 was 55,000.

Purchases of goods for resale in the six months to June 2016, based on the above information, were 114,750 and were budgeted to be as follows:

		Jan	Feb	Mar	Apr	May	Jun
Purchases		9,700	13,000	16,250	20,800	29,250	25,750

Other transactions:

• Plant and equipment was to be purchased for cash, 10,000, in January 2016, and 20,000 in June 2016.
• The plant and equipment depreciation for the 6 month period is included in the other operating costs, below;
• Directors salary 2,000 per month was to be paid in cash January to June 2016;
• Sales assistants wages 1,000 per month was to be paid in cash January to June 2016;
• Other operating costs, 2,200 per month, include depreciation on plant and equipment, 100 per month. The cash operating expenses were to be paid in cash, each month, January to June 2016;
• Corporation tax of 652 was to be paid in June 2016;
• Bank finance charges of 15 were to be incurred in February 2016;

• Debtors were budgeted to pay in full one month after the month of the sale. In this respect sales made in January 2016, for example, would be paid for in February 2016. Debtors for December 2015 were 40,000.
• Creditors were to be paid in full, two months after the purchase of stock. In this respect purchases of stock made in January 2016 would be paid for in March 2016. Creditors for November and December 2015 were 20,000 and 30,000, respectively.
• A dividend of 1,400 was to be paid during June 2016.

Required:

1. For the 6 months period to June 2016, produce the following for Jefferson Ltd

1. A monthly cash budget;
2. A budgeted income statement for the year ended 30 June 2016; and
3. A budgeted statement of financial position as at 30 June 2016

The cash flow forecast must indicate the cash in hand or overdrawn at the end of each month.