You have been approached by a recently established business $$Kimeo$.$ The business is

seeking a loan from $$Matatizo Bank$$ who are prepared to provide overdraft facilities. Before

approval is granted, maximum amount of overdraft is required together with its respective

timing. The company has given you the following facts and forecasts

i$.$ Trading will start on $01$ March $2024$ when TS $8,000,000$ cash will be introduced.

ii$.$ Business premises costing TZS $22,000,000($including rates of $31$ March $2024)$ will be

paid for at the start of trading. A mortgage of the business premises has been

negotiated for the sum of TZS $12,000,000$ receivable on $31$ March $2024.$ This amount

is to be repaid over two years at quarterly intervals by equal instalments of capital plus

interest at the rate of $12\%$ on balance outstanding at the end of each quarter. The first

repayment plus interest will be made on $30$ June $2024.$

iii. A part of the premises will be let on a five year tenancy at TZS $200,000$ per calendar

month $($including property taxes$)$ payable quarterly in advance as from $01$ April $2024.$

iv$.$ Sales are estimated at TZS $8,000,000$ per month for the first quarter, TZS $12,000,000$

per month for the second quarter and thereafter TZS $24,000,000$ per month. All sales

are on credit and will be paid by end of month following that in which sales were made

v$.$ A minimum stock of goods to the value of TZS $12,000,000$ will be purchased in March

$2024$ and will be maintained throughout the period.

vi$.$ Accounts payables will be settled in month following that in which goods were supplied.

vii. Gross profit margin on cost is expected to be $25\%$ throughout the period.

viii. Insurance are estimated at TZS $240,000$ yearly payable on $01$ March $200$ in advance

ix$.$ Property taxes are estimated to be TZS $360,000$ per annum payable half yearly in

advance on $01$ April and $01$ October.

x$.$ Other business expenses are expected to be TZS $1,000,000$ per month to be paid at

the end of the month following that in which they were incurred.

xi$.$ Personal drawings are estimated at TZS $400,000$ per month except in months of July

and October when additional drawings of TZS $200,000$ in each month will be made

Required: Prepare the following:

a$)$ Monthly cash flow forecast for the period $01$ March $2024$ to $31$ December $2024$

$(5$ Marks$)$

b$)$ Forecast Income Statement for the period ending $31$ December $2024(5$ Marks$)$

c$)$ Forecast Statement of Financial Position as at $31$ December $2024(5$ Marks$)$