QUESTION 5 (20 Marks) REQUIRED Prepare the Cash Budget of Electron Ltd for each quarter of 2020. (Ensure that the cash budget has monetary columns for each quarter.) INFORMATION The following forecasts were made by Electron Ltd, which produces memory cards, for 2020: 1. Cash at the bank on 31 December 2019 is expected to amount to R125 000. 2. Sales by quarter are projected as follows: R Units First quarter 290 000 2 900 Second quarter 310 000 3 100 Third quarter 330 000 3 300 Fourth quarter 400 000 4 000 All sales are for cash only. All memory cards produced in each quarter are sold in the same quarter. 4. Each memory card requires 1 hour of direct labour. Employees are paid R20 per hour. Wages are paid for on the 15th and 30th of each month. 5. Direct material purchases for each quarter are expected to be as follows: R First quarter 86 000 Second quarter 89 000 Third quarter 90 000 Fourth quarter 96 000 Direct materials are purchased for cash. 6. Fixed overheads are expected to total R50 000 for each quarter. All fixed costs are paid for in the quarter in which they are incurred. 7. Variable production overheads are expected to amount to R5 per unit produced. All variable overheads are paid for in the quarter in which they are incurred. 8. Fixed selling and administrative expenses are budgeted at R80 000 per quarter and are paid in the same quarter. 9. Variable selling and administrative expenses are budgeted at R4 per unit sold. All selling and administrative expenses are paid for in the quarter in which they are incurred.