Question $3[25]$

The following information pertains to X Traders for the three months ended $30$ June

$2022$:

Actual Budgeted

April May June

R R R

Sales $(20\%$ for cash and $80\%$ on credit$)500000540000580000$

Purchases $(10\%$ for cash $90\%$ on credit$)360000410000450000$

Salaries and wages paid $7000090000100000$

Cash expenses $280003200036000$

Depreciation $200020002000$

$$ It is expected that debtors will settle their accounts as follows: $20\%$ in the month of

sale

$70\%$ in the month after the month of sale, and $5\%$ in the second month after the

month of sale

$$ The remaining $5\%$ is usually written off as bad debts.

$$ Trade creditors are paid in the month after the purchases at a discount of $5\%.$

$50\%$ of the salaries and wages are weekly wages. Because wages are paid

weekly, usually $10\%$ of the wages are paid in the month following the month in

which they were incurred.

$$ Expenses are paid as they arise.

$$ The favorable bank balance on $1$ May was R$30000.$

Required:

Prepare the Cash Budget of X Traders for May and June $2022$