Task 2 Beijing Ceramics is a wholesaler and retailer of tiles and decorative stone. They sell to a range of building and landscape supply companies. They have provided the following information on their sales, purchases, cash payments and cash collections. Sales & Revenue Information February (Actual) $50,000 Beijing Ceramics - Sales Data March April (Actual) (Forecast) $55,000 $60,000 May (Forecast) $60,000 June (Forecast) $65,000 Sales . It is estimated that 20% of the sales are for cash and 80% are on credit. . Of the credit sales - 50% pay their accounts within the month of sale - 30% pay in the month after sale - 20% pay during the second month after sale Purchases and Payments Information Beijing Ceramics - Purchases Data March (Actual) April (Forecast) May (Forecast) June (Forecast) $27,500 $30,250 $36,000 $39,000 Purchases WUC110_Spring_2020 Tutorial Assement 1 All purchases of inventory are made on credit and 40% are paid for in the month they are purchased and 60% in the following month. All selling and administrative expenses, including a depreciation charge of $4,000, are incurred at the rate of $12,000 per month. Payment is made in the month in which the expense is incurred. New machinery costing $18,000 will be purchased in March and the payment will be made in the following month. Beijing Ceramics has a loan of $360,000. Interest at the rate of 8% per annum is paid quarterly, the next due date for payment is 30 June. Opening Bank Balance The balance of the bank account at 31 March is $16,000 Required: 1. Using the template provided below prepare a cash budget for Beijing Ceramics for the period April to June. Your cash budget will need to include a: a. Cash receipts budget b. Cash payments budget c. Total cash budget Cash Budget April - June February (Actual) March (Actual) April (Forecast) May (Forecast) June (Forecast) TOTAL April - June CASH RECEIPTS BUDGET Sales Credit Sales 80% Cash sales 20% Collections current month 50% Collections next month 30% Collections 2nd month 20% Total Cash Receipts CASH PAYMENTS BUDGET Purchases Payments current month 40% Payments following month 60% Selling and Admin Expenses Interest expense New Machinery TOTAL CASH PAYMENTS 16,000 CASH BUDGET Opening Cash Balance Cash receipts Cash Payments CLOSING CASH BALANCE