The following data and estimates are available for ABC Ltd for June, July and August:

June July August

Rs Rs Rs

Sales 45,000 50,000 60,000

Wages 12,000 13,000 14,500

Overheads 8,500 9500 9,000

The following information are available regarding direct materials:

June July August September

Rs Rs Rs Rs

Opening stock 5,000 3,500 6,000 4,000

Material usage 8,000 9,000 10,000

Notes:

(1) 10% of sales are for cash, the balance is received in the following month. The amount received in June for May's sales is Rs29,500.

(2) Wages are paid in the month they are incurred.

(3) Overheads include Rs1,500 per month for depreciation. Overheads are settled in the following month. Rs6,500 is to be paid in June for May's overheads.

(4) Purchases of direct materials are paid for in the month purchased.

(5) The opening cash balance in June is Rs11,750.

(6) A tax bill of Rs25,000 is to be paid in July.

You are required to:

(a) calculate the amount of direct material purchases in each of the months of June, July and August;

(b) prepare cash budgets for June, July and August.