Question A: - Cash Budget: Dave Doughnut has been running a successful doughnut shop for the last couple of years. He has asked you to put together a cash budget. He tells you that the depreciation is $7,800 per year, using the straight-line method, and is included in Office and Admin expenses. He has supplied you with the following information (below) to help you put together his cash budget. Estimated sales January February March April May Total doughnut sales (units) 25,000 19,000 20,500 23,000 11,500 The revenue for a doughnut is $6 for a jelly, $5 for a cruller and $4 for a chocolate. 50% of his sales are jelly doughnuts, 15% cruller doughnuts and 35% chocolate doughnuts. Dave has a deal with an accounting company and half of the doughnuts sold are on account, the other half pay cash. The accounting company pays for the doughnuts the month after the sale. Assume credit sales are half of the total doughnut sales. Material and Labour information Dave has provided: Jelly Cruller Chocolate Labour hours 0.25 0.15 0.10 Direct Material (in grams) 30 20 10 DM cost / gram $0.04 Labour is paid at $15/hour. The Direct Materials need to be ordered a month in advance. He requires 10% of next months total doughnut DM to be on hand. The beginning DM inventory, February 1, was 30,000 grams. 50% of the direct materials are paid in the month they are ordered, 50% are paid the following month. Other information Dave has provided: February March April May Rent 5,000 5,000 5,000 5,000 Dividend 30,000 15,000 Office and Admin 7,500 7,500 7,500 7,500 NOTE: Dave requires a minimum bank balance of $5,000 at the end of the month and the ending January bank balance is $10,000. Dave has access to a line of credit of $500,000 at an interest rate of 30%. Borrowings are made at the beginning of the month and repayments are made at the end of the month. REQUIRED: Submitting either an Excel or a hand written PDF file, for the months of February, March and April prepare: Sales Budget, with a cash receipts. o What is the A/R at the end of the month? Materials Budget, with cash disbursements. o What is the A/P at the end of the month? Direct Labour Budget Cash budget