MA221 Assi July 19.pdf Answer all questing in the lion. Question (20 marks) OBOU 2019 Page 3 of 6 Degree July - December Assignment MA221 Business Management Accounting DeLux Brothers (Pty) Ltd intends to expand its Palapye hased operations by acquiring a new plant The Finance Manger has been asked by the owners of the company to prepare cash flow forecasts for the business for the period December 2017 to May 2018. The marketing department has prepared the following forecasts. Month October 2017 - Actual November December January 2018 February March April May Sales BWP 180 000 180 000 360 000 450 000 500 000 360 000 360 000 280 000 Collection estimates from the credit department are as follows: > Collections within the month of sale (cash sales) - 10% Collection in the month following the sale -75% Collection in the second month following the sale -15% Total labour and raw materials costs are estimated for each month as follows: BWP Month December 2017 January 2018 February 216 000 270 000 300 000 250 000 March OBOU 2019 Page 4 of 6 BULI 2019 Page 4 of 6 Degree July-December Assignment MA221 Business Management Accounting April May 216000 168 000 General and administrative expenses will amount to approximately 227 000 per month lease payments will amount to P9 000 per month depreciation will be P34 000 per month miscellaneous payments will be 2 700 per month income tax payment of P200 000 will be due in March 2018 and a deposit of P180 000 on a new vehicle will be required in December 2017. The bank charges interest on overdraft of 79 (assume the interest is charged on closing balance for the previous month). The cash balance at the end of November will be P40 000 Required: a) Prepare a cash budget for the period December 2017 to May 2018 b) Briefly outline any five advantages of a zero based budgeting (ZBB) (21 marks) (5 marks) 100