QUESTION THREE $[25]$

The following data appeared in the financial records of GTR Projects Limited:

$1.$ Revenue and expense figures reflected the following:

Actual Estimated

January

R

February

R

March

R

April

R

May

R

Revenue $192000240000120000320000400000$

Purchases $200000100000320000168000120000$

Revenue commission $800120024001600800$

Wages $160016001600??$

$2.$ Cash transactions:

$-40\%$ of all revenue are for cash with the balance being on credit.

$-35\%$ of all purchases are for cash with the balance being on credit.

$3.$ Collections for credit revenue are as follows:

$-20\%$ is collected in the month of the revenue and a $2\%$ discount is granted on these

collections.

$-60\%$ is collected in the month following the month of revenue.

$-15\%$ is collected in the second month following the month of revenue.

$-$ The remaining $5\%$ is written off as bad debts.

$4.$ The company will make an investment of R$170000$ in fixed deposit on $01$ April. Interest

of R$3500$ per month is expected to be received from $30$ April.

$5.$ Creditors are paid two months after the date of invoice.

$6.$ Rent expense amounts to R$11000$ per month and is payable on the first day of each

month.

$7.$ Wages will be increased by $10\%$ in April and will increase by a further $5\%$ in May.

$8.$ A new machine is expected to be purchased for R$30000$ cash on $1$ May. Depreciation is

calculated using the straight$-$line method.

$9.$ Revenue commission is paid in the month following the month in which it was earned.

$10.$ On $31$ March the company had a bank overdraft of R$5000.$

Required:

$3\mathrm{.}1$ Prepare a Debtors Collection Schedule for April and May. $(8)$

$3\mathrm{.}2$ Prepare the Cash Budget for April and May. $(17)$