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The budgeted information below relates to JJ Sanitisers ( Pty ) Ltd , a merchandiser that buys and resells hand sanitisers. The CEO is Joshua

The budgeted information below relates to JJ Sanitisers (Pty) Ltd, a merchandiser that
buys and resells hand sanitisers. The CEO is Joshua Monama. Sam Malatji is the
bookkeeper.
1. Sales, cost of sales, and debtors' collection in terms of the hand sanitisers:
June 2024
July 2024
R
R
August 2024
Total sales
R
550000
600000
Cost of sales
580000
450000
435000
Opening inventory
420000
45000
?
Closing inventory
?
38000
40000
Cash sales comprise 50% of total sales.
43000
Debtors settle their accounts in the month following the month of sales.
2. Purchases of inventory and payment to creditors:
Cash purchases comprise 25% of total purchases.
Creditors are paid according to the following trend:
o 80% are paid in the month of purchases to receive a 5% discount.
o 20% are paid in the month after purchases.
3. Rental income:
Excess storage space is rented out at a fixed rate of R100 per square metre (m2).
Rent is received in the month that it relates to.
An existing tenant occupies 60 m2. His lease expires on 30 June 2024.
A new tenant has signed a lease agreement for the period 1 July 2024 to
30 June 2025. She will occupy a 75 m2 storage area.
4. Salaries of admin and sales staff:
A new employee will be appointed from 1 July 2024. He will earn R14800 per
month.
All the other admin and sales employees will receive an annual increase of 5%,
effective from 1 July 2024.
These salaries are paid in the month that they relate to.
5. Delivery expenses:
Deliveries are outsourced to Alpha Deliveries. Delivery expenses are budgeted at a
fixed percentage of the monthly sales and are paid in the month that they relate to.
6. The company is expected to have an opening bank balance of R53756
(favourable) on 1 July 2024.
7. Total depreciation amounts to R10000 per month.
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[CONFIDENTIAL]
[TURN OVER]
MAC2601
MAY 2024
[CONFIDENTIAL] Page 10 of 10[TURN OVER]
8. The company plans to buy a new car and pay a deposit of R15000 in this regard in
July 2024.
9. Additional information:
June 2024
Salaries of admin and sales staff R100300
Delivery expenses R5500
Warehouse overheads (inclusive of the total depreciation referred to
above)
R74000
Where applicable, warehouse overheads are paid in the month that they relate to.
REQUIRED Marks
(a) Prepare the Cash Budget for JJ Sanitisers (Pty) Ltd for the month of
July 2024.
(21)
(b) List three advantages and two disadvantages of increment

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