Perisic Madhavan is planning to start up a business selling ice cream from a van around his local neighbourhood from April to September. He wants to open a business bank account, but the bank manager has insisted that he provides a cash budget together with a budgeted statement of profit or loss for his first six months of trading. Perisic is unsure how to put this information together and when he came across you during a BBQ get-together event, he learnt that you are an expert in budgeting and forecasting financial figures and statements. Immediately, he sought your assistance and provided you with the following details of his planned income and expenditure.

Perisic will pay in $5,000 of his own money on 1 April to get the business started.

He expects to make a all his sales for cash and anticipates that he will make sales of $3,500 in April, $5,500 in May, $7,500 in each of the next three months and $2,500 in September

. He will buy his ice-cream from a local supplier and expects the cost of this to be 50% of selling price. Perisic has agreed with his supplier that he will start paying for his ice cream in May rather than in the month of purchase.

Perisic intends to sell all his ice cream by the end of September and to have no inventory at the end of this trading period Ice cream vans can be hired at a cost of $1,500 for three months. The $1,500 hire charge is payable at the start of each three-month period.

Van running costs are estimated to be $250 per month payable in cash each month

Business insurance payable on 1 April will cost $500 for six months

Perisic will draw $1,000 per month out of the business bank account to meet his personal expenses.

You are to provide the following for Perisic:

1. A cash budget for this first six months of trading

2. A budgeted statement of profit or loss for his first six months of trading.