Question 5 You are given the following information for Luxor Manufacturing Ltd; a) Cash balance - 1 January is N15,250,000 b) 50% of sales are collected in first month and the balance the following month c) Assets (Plant & Equipment) will be acquired in February and April. Therefore, provisions should be made for payment of N75,000,000 and N25,000,000 respectively. d) A bank loan of N30,000,000 is expected in May e) The firm is expected to pay a dividend of N35,000,000 in June f) Creditors for materials grant one-month credit g) A sales commission of 3% on sales is paid to salesmen monthly. h) 20% of salaries and wages are delayed for one month i) Production and office & selling overheads are settled in the month incurred j) The Finance Manager is authorized to arrange for short-term financing should the need arise (ignore short-term financing costs) Details of sales and expenses are shown below: Month Sales Materials Salaries & Wages Production Office & Selling Overheads N'000 N'000 N'000 N'000 Overheads N'000 December 86,000 30,000 9,000 15,900 5,400 January 72,000 25,000 10,000 16,000 5,500 February 97,000 31,000 12,100 16,300 6,700 March 86,000 25,500 10,600 16,000 7,500 April 88,600 30,600 25,000 16,500 8,900 May 102,500 37,000 22,000 18,000 11,000 June 108,700 38,800 23,000 18,200 11,500 Required: Prepare the Cash Budget for Luxor Manufacturing Limited for period January to June. [20 marks] 3