Question 1(a) Cash Budget Simone Limited distributes specialist wines on wholesale basis to its customers. Some of his sales will be for cash from a shop that he intends to rent. It also plans to sell some wine on credit to local restaurants and hotels. The details of his business plan are as follows: (a) It will rent a shop for GH10,000 per annum payable quarterly in advance. The landlord also requires a deposit of GH5,000 to be paid when the rental starts in June. (b) It will invest GH12,000 from its own savings and a bank will loan it GH8,000. Interest is to be charged at a rate of 5% per annum payable annually. (c) It will purchase and pay for GH12,000 of wine in June and thereafter. To maintain that level of stock, he will continuously purchase wine to replace what is sold. (d) Suppliers will allow one months credit and credit customers will expect one months credit. (e) Sales levels are predicted to be: Total sales Cash sales Credit sales GH GH GH June 6,000 3,000 3,000 July 6,500 3,000 3,500 August 7,000 3,000 4,000 September 8,000 3,500 4,500 October 9,500 4,500 5,000 November 12,000 5,000 7,000 (f) Wine will be sold at a gross profit margin of 20%. (g) It intends to withdraw GH500 per month for private use and will employ a part-time assistant for GH400 per month. (h) It will need to purchase and install shelving that will be delivered and paid for at the beginning of June at a cost of GH3,800. (i) It will also lease a van at a cost of GH450 per month. (j) Other anticipated costs are: GH June 500 July 380 August 400 September 500 October 550 November 600 Required (a) Prepare a cash budget for Simone Limited for first 6 months trading to 30 November 2021. (b) Determine the size of overdraft facility Simone Limited should request from the bank.