Task $6$

The following are the actual results for May and June and budgeted results for July, August and September of Dream Big Pty Ltd$.$

Purchases are paid for $75\%$ in the month of purchase and $25\%$ in the following month. Purchases are invoiced on the last day of

the month. Other costs amount to $$34,500$ per month are paid in cash.

$30\%$ of sales are cash sales. Credit sales are invoiced on the last day of the month. Of the credit sales, $65\%$ are collected within

one month of the invoice date and the remaining are collected during the second month after invoice date.

The cash balance on $30$ June is $$12,495.$ The desired cash balance of the business is $$13,000$ from July $31.$ If the business will be

short of this, then it will take a bank overdraft and when the business has sufficient cash balance it will pay off its liabilities.

Required:

Read the information above to establish$/$confirm the budgetary milestones and performance indicators for Dream Big Pty Ltd$.$

a$)$ Prepare a cash budget including Cash Payment and Cash Receipt Budget based on the milestones and performance

indicators for the months of July, August and September so that the business can check if it has enough funds to pay off

its liabilities. Assume the business is not registered for GST$.$

Confirm whether the budget objectives for July, August and September are in line with Dream Big Pty Ltd overall aims and would

be consistent with other projects and future forecasts. $(1-2$ sentences$)$

a$)$Task $5$

Following the information from Task $4,$ Tom started the business in Oct $2024$ with $$65,000$ capital. Assume that all the expected sales will be cash sales and all expenses will be paid in the same quarter.

Prepare Budgeted Bolance sheet for the quarter ended December $2024.$

Budgeted Balance sheet

$\backslash$table$[[$Assets:$,,],[$Cash$,,],[,,],[$Liabilities:$,,],[$Net assets,,$],[$Owners$\text{'}$ equity:,,$],[$Capital$,,],[$Add: Net profit,,$]]$