prepare a cash budget for six months ending 31 december 2016

Month Sales Wages Administration Overheads April May June July August September October November December Sh. "000" 86,000 78,000 74,000 72.000 97,000 86,000 88,600 102.500 108,700 Material Purchases Sh. 1000 25,500 30,000 26,000 25,000 31.000 25,500 30,600 37,000 38,800 Sh. "000" 10,600 10,000 12.100 10,000 12,100 10,600 25,000 22,000 23,000 Sh."000" 6,000 10,000 8,000 6,000 6,300 6,000 6,500 8,000 18,200 Production Overheads Sh. '000' 7,500 7,000 8,000 5,500 6,700 7,500 8.900 11.000 11,500 Additional Information 1) Depreciation expenses of production machinery are expected to be 5 % of sales and have not been included in the production overheads. I 2) Expected cash balance in hand on 1 July 2016 is Sh. 60,500,000 3) 60% of total sales are cash sales 45% of the debtors pay after one month and the rest is paid after two months 4) Fixed assets are to be disposed in the months of May and June at Shs. 950,000 and Shs. 870,000 respectively on credit. Payments are expected two months later respectively. 5) It is anticipated that a dividend of Shs 5,000,000 will be received in November 6) Sales commission at 13% on sales is paid to the salesmen each month 7) Material purchases are all on credit and suppliers allow a two months credit Required