The following information relates to XY Ltd: Month Wages incurred () Materials purchases () Overhead () Sales () February 6,000 20,000 10,000 30,000 March 8,000 30,000 12,000 40,000 April 10,000 25,000 16,000 60,000 May 9,000 35,000 14,000 50,000 June 12,000 30,000 18,000 70,000 July 10,000 25,000 16,000 60,000 August 9,000 25,000 14,000 50,000 September 9,000 30,000 14,000 50,000 (i) It is expected that the cash balance on 31st May will be 22,000. (ii) The wages are paid within the month they are incurred. (ii) It is company policy to pay creditors for materials three months after receipt. (iv) Debtors are expected to pay two months after delivery. (v) Included in the overhead figures is 2,000 per month which represents depreciation on two cars and one delivery van. (vi) There is a one-month delay in paying the overhead expenses. (vii) 10% of the monthly sales are for cash and 90% are sold on credit. (viii) A commission of 5% is paid to agents on all the sales on credit but this is not paid until the month following the sales to which it relates; this expense is not included in the overhead figures shown. (ix) It is intended to repay a loan of 25,000 on 30th June. (x) Delivery is expected in July of a new machine costing 45,000 of which 15,000 will be paid on delivery and 15,000 in each of the following two months. (xi) Assume that overdraft facilities are available if required. Required: a) Prepare a cash budget for each of the three months of June, July and August. b) regularly to monitor cash flow-moneys coming into the company each month minus moneys going out.' (Financial Times) 'Experts stress that one of the most vital uses of management accounts is Comment on the above statement, including in your answer the chief benefits obtained from the preparation of cash budgets.