Q.2. Prepare a Cash Budget for the three months ending 30 June 2020 from the information given below: (a) Month Sales (Rs) Materials (Rs) Wages (Rs) Overheads (Rs) February 15,000 8,000 3,000 1,800 March 18,000 8,000 3,000 1,900 April 19,000 8,200 3,200 2,200 May 14,000 11,000 3,600 2,300 June 20,000 9,000 4,000 2,400 (b) Credit terms: 10% sales are on cash basis, 50% of the credit sales are collected next month and the balance in the following month: Creditors: Materials 2 months Wages month Overheads month (c) Cash and bank balance on 1" April 2020 is expected to be Rs 5,000 (d) Other relevant information: i) Income tax to be paid in June is Rs 2,000 ii) Dividend @5% on preference share capital of Rs 1,00,000 will be paid on 1" June 2020 iii) Plant and machinery will be installed in February 2020 at a cost of Rs 96,000. The monthly installment of Rs 2,000 is payable from April onward.