Required: Cash Budget for the period 1 December 2019 to 31 January 2020

QUESTION 11-IREE [30] You are provided with information relating to MTIJELL Providers for the two months ending 31 January 2020. Molly Sums owns the business. The business has overdraft bank facilities of R50 000. 1. Sales and Cost of Sales Actual Sales Budgeted Sales Cost of Sales October 2019 100 000 75 000 November 2019 120 000 90 000 December 2019 160 000 120 000 January 2020 200 000 150 000 2. 20 'lt: of the total sales are on credit. 3. Debtors are expected to pay their aooounts as follows: - T0 0.0! In the month following the month at the sale. 23 to two months following the month of the sale. 2 t: is to be written ofl' in the third month following the month 01' the sale. 4. A xed level of trading stock on hand is maintained throughout the year through replacement on a monthly basis. 5. Purchases of stock: 65 9t: ofall stock is bought on credit. - Creditors are paid in full in the month following the month of purchase to qualify for a 5 'l-t: discount. 3. It has been agreed that the owner M. Burns. will take unused equipment at book value in January for her own use. worth R2 000. 1'. R120 000 was invested in xed deposits with Tar Bank on 1 November 2019. Interest is received on a monthly basis at 15 \"it: p.a., half of these xed deposits mature on 31 December 2019. \"the rest matures in February 2020. 1D. 11. 12. 13. Rent of R9 000 is payable by HIT-CELL Providers at the start of each month. This will be increased by 5 'ltl with effect from 1 January 2020. Total salaries for November 201 Q amounts to R13 000. One employee, who earns R1 000 per month, will leave the business at lhe end of November 2019. The salaries of the remaining employees will be increased by 10 % with effect from 1 January 2020. A vehicle with a carrying value of R50 500 will be traded-in at book value on 01 December 2019 for a new vehicle costing R100 000. A deposit of R1 9 500 will be paid on 1 December 2019 and the balance of the outstanding amount I.llrill be paid in six equal instaknents commencing 1 January 2020. The bookkeeper is paid a monme fee of R2 000. Other operating expenses were R? 500 for November. These expenses are expected to increase by R500 each month thereafter. The business has an overdraft of R17 000 at the beginning of December 2019. Interest is calculated by the bank on the balances at the beginning of each month. Provide for interest at the following rates (calculations to the nearest RJ: - Unfavourable balance: 2 Bill: per month. - Favourable balance: 1 % per month. Required: Cash Budget for the period 1 December 201 Q to 31 January 2020