Question 4 (10 marks) The CFO of DigiTech Ltd. has obtained the fo owing budget information for the first three months of the coming financial year. --- nnll Selling and administrativeexpenses 48,400 46,400 40,400 Sales include both cash and credit sales. The comp any expects to sell 30% of its merchandise for cash. 0f sales on credit, 60% are collected in full in the month of the sale, 20% are collected in the second month of sale, and the remainder in the third month following the sale. One-quarter of the manufacturing costs are paid in the month in which they are incurred, and the balance is paid in the following month. Depreciation of $6,400 is included within the monthly selling and administrative expenses. Of the remaining balance of the selling and administrative expenses, one -half are paid in the month in which they are incurred and the balance is paid in the following month. The company is required to repay the loan, amounting to $100,000, on the 31t May. The balance of cash at the bank on 15t May is $770,500. Required: a) Prepare a monthly cash budget for the end of month of May only. (5 marks) b) Exp lain to DigiTech's management what the cash budget prepared in part a) reveals about their business. (Smarks) (5 + 5 = 10 marks)