Question

Compile the cash budget for January, February and March. (Prepare separate monthly columns)

JanuaryFebruaryMarchCASH RECEIPTS Cash sales Receipts from debtors CASH PAYMENTS( )( )( ) . Cash surplus/deficit Opening bank balance Closing bank balance The following information has been provided by Aveng Limited to be used in compiling a cash budget for January, February and March. 1. \70 of total sales are for cash. Credit sales are collected as follows: \50 is collected one month after the sale \40 is collected two months after the sale \10 is written off as bad debts 2. The company has an investment in listed shares. It is expected that dividends of R25 000 will be received inFebruary. 3. Aveng Limited rents out a building that it owns. The building is \\( 120 \\mathrm{~m}^{2} \\). Rental received in December was R100 per \\( m^{2} \\). Rental is expected to increase by \10 from 1 February. Credit purchases are paid for as follows \60 one month after purchase - \40 two months after purchase 5. Equipment is currently leased under an operational lease. Monthly payments of R4 200 are made on the last day ofevery month. 6. Aveng will purchase a new delivery vehicle on 1 February at a cost of R220 000. This purchase will be fundedthrough an instalment sale agreement. A deposit of \20 will be made on purchase and the remainder will be paid in monthly instalments of R6 500 beginning on 28 February. 7. Salaries for December amounted to R 125000 . An annual increase of \8 will be effective from 1 January. 8. The company also uses part time staff on a regular basis. These staff are paid monthly and work for 80 hours per month. It is expected that 10 part time staff will be used monthly from January to March. These staff are paid an hourly wage of R30.(This cost is not included in the salary figure above) 9. Sales people are paid an additional monthly sales commission amounting to \5 of total sales. Commissions arepaid one month later. 10. Aveng rents a warehouse for storage of inventory. Rental paid in December was R24 000. The landlord has indicated that a \10 increase in rental will be implemented from 1 January. 11. A cleaning company has been contracted to clean the company's premises. Total charges for December were R12 000. The cleaning company has indicated that fees will increase by \6 from 1 January. 12. Electricity paid in December amounted to R 15000 . It is expected that electricity costs will increase by \12 from 1 January. 13. The company had a favourable bank balance of R65 500 on 31 December