LUAREA Company newly starting manufacturing operations on st January, 2010 has made adequate arrangements for funds required for fixed assets. It wants you to prepare an estimate of funds required as working capital. It is to be remembered that : (a) In the first month there will be no sale, in the subsequent months sale will be 25% cash and 75% credit. Customers will be allowed one month credit. (b) Payments for purchase of raw material will be made on one month credit basis. (c) Wages will be paid for previous fortnight on the 22nd and the 7th of each month. (d) Other expenses will be paid one month in arrears except that 50% of selling expenses are to be paid immediately on sale being effected The estimated sales and expenses for the six months, spread evenly over the period subject to (a) above are as under : Sales 3,60,000 Materials consumed 1,50,000 Wages 60,000 Manufacturing Expenses 48,000 Administrative Expenses 54,000 Selling Expenses from January 42,000 Depreciation on Fixed Assets 50,00 000. The articles produced are subject to excise duty equal to 10% of the selling price. The duty is payable on March 31, June 30, September 30 and December 31, for sales upto February 28, May 31, August 31 and November 30 respectively. Prepare Cash Budget for each of the six months indicating the requirements of Working Capital