REQUIRED

Use the information provided below to prepare the Cash Budget of Project Oscar for February, March and

April $2025.($Provide separate monetary columns for each month.$)$

INFORMATION

The following information relates to Project Oscar which commenced a year ago.

$1.$ Additional machinery and equipment will be purchased on credit on $28$ February $2025$ for R$500000.$ A

deposit of $40\%$ will be paid on $28$ February $2025$ and the balance will be paid in five equal monthly

instalments commencing March $2025.$

$2.$ As additional factory space is required the existing rental of R$168000$ per year, payable monthly, will be

increased by $20\%$ with effect from $01$ March $2025.$

$3.$ Estimated sales at R$60$ per unit for January to April $2025$ are as follows:

Month Units

January $3000$

February $3300$

March $3400$

April $3200$

$4.$ Cash sales are expected to comprise $40\%$ of the total sales. Twenty percent $(20\%)$ of the cash sales is

subject to a $10\%$ cash discount. The balance of the sales will be on credit and debtors are expected to

pay in the month after the sale.

$5.$ Variable manufacturing costs per unit are as follows:

Direct materials R$10$

Direct labour R$8$

Variable overheads R$6$

Expected production figures are as follows:

Units

December $20243900$

January $20253400$

February $20253700$

March $20253800$

April $20253600$

$6.$ Direct materials will be purchased on credit and paid two months after the month of purchase.

$7.$ Direct workers will be paid on the last working day of each month.

$8.$ Fifty percent $(50\%)$ of the variable manufacturing overheads will be paid in the month in which they are

incurred. The balance is payable in the following month. $($Show only the total amount payable for each

month.$)$

$9.$ Fixed overheads amount to R$16000$ per month and include depreciation of R$4000$ per month. Fixed

overheads are paid for in the month in which they are incurred.

$10.$ The balance in the bank account on $31$ January $2025$ is expected to be R$100000.$