Question 3 Ginger Ltd has a division in Gingerly Island and the Finance manager has approached to you assist them in developing a cash budget for a period of three months from August to October 2021. The company's activities are planned as follows: 1. Planned sales for July, August, September and October 2021 are $190,000, $200,000, $210,000 and $220,000. 2. 40% of sales are on a cash basis while the remaining sales are on credit and 60% is collected one month after sale. 3. The company's purchases are 65% of sales. Purchases are made one month prior to sales, with payments made in the month following the purchase. 4. The bank balance on at 31 July 2021 is expected to be $120,000. 5. Fixed salaries cost the company $29,600 per month. 6. $50,000 worth of Office Equipment is expected to be bought and paid for at the end of October 2021. Required: Prepare the monthly cash budget for the period of three months ending October 2021 for Ginger Ltd's Gingerly Island.NOTE: Copy the cash budget format into your answer document. Ginger Ltd Cash budget from August to October 2021: August September October Total Cash receipts: $ $ $ Total sales (for reference only) Cash sales (40% of Total sales) Collection from credit customers: 60% in the month following sales Total Receipts Cash Payments: Purchases - 65% of total sales Fixed salaries Purchase of Office Equipment Total Payments Surplus/(Deficit) for the month Cash balance, at start of month Cash balance, at end of month