Question 4 Mustang Sdn. Bhd. has estimated its costs and revenues for the coming four months of 2021 as follows: September October November December (RM) (RM) (RM) (RM) Sales 1,052,000 1,118,000 1,304,000 1,282,000 Material purchases 408,000 424,000 468,000 456,000 Wages 281,000 284,000 291,500 293,000 Overheads 390,538 417,708 414,833 422,500 You are provided with the following additional information: 1. 30% (by value) of the materials purchased are cash purchases, with the company receiving a cash discount of 5%. 40% of the materials purchased are paid one month later and the remainder two months later. Purchases in the month of July and August were RM393,000 and RM374,000 respectively 2. 35% of the total sales are cash sales, for which a 5% discount is given. Another 35% pay one month after sale, and the remainder after two months, with the exception of 3% of the original sales which are expected to be bad debts. Sales for the month of July and August were RM992,000 and RM1,013,000 respectively. 65% of the wages incurred are paid in the month incurred, and 35% one month later. Wages incurred for August were RM279,500. Capital equipment costing RM 125,000 will be purchased and paid in September. This will be financed by a loan, repayable monthly over twelve equal installments with interest of 20% of the original sum. Payments will commence in October. This equipment will be depreciated on a straight-line basis over four years, commencing in September. The company also has other machinery costing RM375,000 which are also depreciated on a straight-line basis over four years. The depreciation for these assets is excluded in the overheads. 5. The overheads are paid in the month following the month they are incurred. Overheads for August were RM347,734. 3. 6. Overdraft resulting at the end of each month will incur interest of 18% per annum. This will be payable in the month immediately after the overdraft is incurred. 7. The bank balance at 1 September is expected to be RM83,000. Required: Prepare the monthly cash budgets for the 4 months from September to December 2021. (25 Marks) [Total: 25 Marks)