Management accounting and finance

The following information is applicable to Shine Wholesalers for the year 2020: . Budgeted sales: July R105 000 August R132 000 September R165 000 In October 2020, sales are expected to increase by 20% relative to sales in September 2020. Cash sales amount to 20% of total sales. 55% of all credit sales are collected in the month of sale, with a discount of 10% to those debtors who pay during this time. The outstanding credit sales are collected in equal instalments over the next two months. There are no bad debts. . Purchases of raw materials are expected to be sufficient to meet 60% of the total sales for the next month. The company normally settles half of its creditors in the month following the month of purchase. The remaining creditors are paid two months after the month of purchase. Wages and salaries are paid to employees at the end of the month in which they are earned. Wages and salaries are expected to be: June R22 200 July R20 500 7/8 August R23 500 September R26 500 October R28 000 Rent amounts to R48 000 per annum. This amount is spread evenly throughout the year. . All other overheads amount to R38 160 per annum, including annual depreciation amounting to R22 500. Other overheads and depreciation are incurred evenly throughout the year. An industrial printer which was recently purchased for R45 000 will be paid off in three equal instalments, commencing in August 2020. The company expects to receive tax refunds of 28 700 from SARS in September 2020. The company had taken a loan of R10 000 in January 2020. The loan will be repaid in four equal instalments. The last instalment will be repaid in September 2020. The company's bank balance at the end of August 2020 was R35 000. The management director of the company wants to revamp the company's IT system in November 2020. This undertaking is expected to cost the company R400 000. She wants to know if the company will have sufficient cash to execute the project. Overdraft facilities are available. Required: Prepare a cash budget for Shine Wholesalers for the months of September and October 2020. Note: show ALL calculations