PMF PLC is a company selling electric home appliances. Budget data for each of the six months to March are given below: Feb Mar Oct $'000 265 Nov $'000 265 Dec $'000 265 Jan $'000 275 $'000 275 $'000 300 88 88 98 118 128 143 178 180 210 Credit sales Cash sales Credit purchases Labour Other operating costs (excluding depreciation) 175 23 210 33 210 38 23 23 38 85 85 85 120 122 125 Credit sales: 75% of the value of credit sales is received in the month after sale, 15% two months after sale and 8% three months after sale. The balance is written off as bad debt. Credit purchases: 60% of the value of credit purchases is paid in the month after purchase and the remaining 40% is paid two months after purchase. Labour expenses will be paid in the same month in which they are incurred. Other operating costs: 70% of other operating costs will be paid in the month in which they are incurred and 30% in the following month. The cash balance as at 1January is estimated to be $15,000. Required: (a) Explain three purposes of budgets. [5 marks) (b) Prepare the cash budget for each of the THREE months of January February and March [12 marks] (c) State the options available for PMF PLC to manage the cash surplus. [3 marks)