QUESTION 5 (10 marks) The directors of Candice CC are concerned with the negative cash balance that has become a regular occurrence in the company. They requested you to assist them with compiling a cash budget for the coming months. The following information is provided: January February March Sales R150 000 R175 000 R170 000 Material purchases R54 000 R60 000 R72 000 Rent expense R15 000 R15 000 R16 000 Other expenses R90 000 R95 000 R97 000 Other expenses include a depreciation charge of R10 000 per month. Historical records indicate the following for sales: Cash amounts to 10% of total sales Credit sales amounts to 90% of total sales; of which: 60% pay one month after sale O 35% pay two months after the sale 5% is classified as bad debts Similar statistics for material purchases payments: Payments are in cash for 20% of purchases 0 All credit payments are made one month after the purchase. The cash balance on 1 March 20.22 was R6 500 unfavourable.