Sun Ltd is a manufacturer of juices. It wholesales to the beverage industry and has been having issues with cash flows in recent months. They believe their cash flow planning has been poor and have approached you, an independent accountant to draw up their cash flow for the next 3 months. The data they have provided you are as follows (2 months of actual performance and 3 months of projected performance): Sales (all amounts in Rands): November December January February March Actual Actual Forecast Forecast Forecast 80 000 150 000 180 000 240 000 300 000 The cash from sales are received as follows: o 30% in the month of sale o 40% 1 month after sale o 30% 2 months after sale Purchases are 65% of sales Cash purchases are made in the following manner: o 20% cash in the month of purchase o 40% 1 month after purchase o 40% 2 months after purchase Cash dividends of R15 000 was received in January Rentals of R7 500 are due and paid at the end of each month The company has 1 salaried employee who is paid each month Wages incurred and paid equate to 8% of the previous months sales The company bought a new machine in March for R250 000. Only a deposit of R130 000 was due and payable in March A provisional tax payment of R30 000 was made at the end the February R15 000 interest was paid against the companys bank account in February Dividends declared at the end of March amounted to R20 000. A 1st payment of R10 000 was made on 31st of March A loan of R80 000 was also repaid end March The bank cash balance at the end of December is R60 000 Required: 1.1. Prepare the cash budget for the months of January, February and March (23) 1.2. If the minimum cash balance at the end of every month needs to be R16 000, will the company need to borrow funds to maintain this minimum cash balance at the end of March or will there be adequate cash reserves to cover the minimum cash holding required? What will this amount be? (