Question

3. From the following information of Modern Ltd. prepare a cash budget for the three months commencing
1st January,
Months
17. 2,500
November 2018
December 2018
January
February
March
2019
Other information:
Sales
Purchases Wages
Expenses
₹
₹
25,000
5,000
10,000
2,000
30,000
10,000
10,000
2,000
2019
20,000
15,000
11,000
2019
( 1 )
25,000
10,000
11,000
2,500
30,000
5,000 ( 12,000
2,500
Baliw bunu birou Bar
m 10% of sales and purchases are on cash basis and balance are on credit basis.
c) Credit to debtors : 1 month; on an average 50% of debtors will make payment on the due date while
the rest will make payment one month thereafter.
(c) Credit from creditors: 2 months ; 10% cash discount will be received if payment is made within one
month and it is estimated that for 50% of purchases, advantage of cash discount will be taken.
(a) Wages : To be paid twice in a month on the 1st and 16th of each month.
(e) Expenses are paid generally within the month.)
op Opening cash balance was 10,000.

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Answer 1

Answer:

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Answer 2

Explanation:

(c) Credit from creditors: 2 months ; 10% cash discount will be received if payment is made within one

month and it is estimated that for 50% of purchases, advantage of cash discount will be taken.