QUESTION 3 [25 MARKS] Roberto Ltd is a dealer in electronic goods. The following information relates to the period July 2016 to September 2016. 1. The bank balance on 31 July 2016 is expected to be $45 000 (credit). 2. Sixty percent of all sales are for cash; the balance is on credit. Cash sales for June and July 2016 are expected to be $240 000 and $300 000 respectively. As from August onwards, Cash sales are expected to increase by 5% per month while credit sales are expected to increase by 10% per month. Sixty percent of credit customers are expected to pay after one month for a cash discount of 2%. The remaining customers will pay after two months, but 5% of them are expected to be bad debts. 3. Roberto Limited sells its electronic goods at cost plus 100%. All goods that are sold each month are replaced in the same month. All purchases are on credit and suppliers are paid one month after the purchase. 4. Salaries and wages are expected to cost $82 500 for September 2016 after a 10% increase takes effect from 01 September 2016. 5. 6. 7. Advertising expenses are expected to be 5% of monthly sales, and are paid one month later. Equipment costing $200 000 is expected to be purchased during August 2016. A deposit of 10% will be paid in August and the balance payable in 6 equal installments commencing September 2016. A long-term loan of $180 000 at 12% per annum interest is to be raised on 01 September 2016. Interest is payable quarterly in advance with the first interest payment to be made on 01 September 2016. Other expenses, including depreciation of $4 000, are expected to amount to $46 000 each month and payments are made monthly. An interim dividend of $0.06 per share is expected to be paid on 31 August 2016. The authorized share capital of Roberto Limited consists of 800 000 ordinary shares of which 500 000 shares were issued. 8. 9. Required: Use the information provided to prepare a Cash Budget for Roberto Limited for August and September 2016 (use separate columns for each month)