REQUIRED

Use the information provided below to prepare the following for August and September 2023:

4.1 Debtors Collection Schedule

4.2 Cash Budget

INFORMATION

The following information was provided by Orlando Enterprises:

The bank balance on 31 July 2023 is expected to be R80 000 (favourable).

The expected sales are as follows:

(4 marks) (16 marks)

JuneJulyAugustSeptemberCash salesR408 000R480 000R412 000R300 000Credit salesR500 000R540 000R224 000R340 000

3. Customers who purchase for cash are entitled to a 5% discount. Collections from credit sales are expected to be as follows:

3.1 20% in the month of sale, and these debtors receive a 2% discount

3.2 80% in the month after the sale

The expected purchases (excluding discounts) are as follows:

A discount of 10% is receivable on all cash purchases. Creditors are paid two months after the month of purchase.

The proprietors cash drawings will amount to R20 000 for September 2023.

The monthly salaries amount to R120 000. Salaries will increase by 7.5% with effect from 01 September

2023.

The final instalment on the loan, R12 000, together with interest at 18% p.a. for one month will be paid at the

end of August 2023.

A vehicle will be purchased during August 2023 for R480 000. A deposit of 20% will be paid during August

2023. The balance of the loan plus interest of R71 400 will be paid in 36 equal monthly instalments from

September 2023.

Cash operating expenses are expected to amount to R80 000 for July 2023 and are expected to increase

by 2% per month thereafter.