Question

-Office
Months
NE
To Summarised below are the income and expenditure forecasts for the months of March to August,
Sales Purchases Wages Manufacturing
Selling
(all credit) (all credit)
expenses expenses erpenses
₹
March
60,000 36,000 9,000
4,000
2,000 4,000
April
62,000 T: 38,000 8,000 3,000
1,500 5,000
May
64,000 33,000 10,000 4,500 2,500 4.500
June
58,000 35,000
8,500
3,500 2,000 3,500
July
56,000 39,000 9,500
4,000 1,000 4,500
August
60,000 34,000 8,000 3,000 1,500 4,500
You are given the following further information :
(a) Plant costing * 16,000 is due for delivery in July, payable 10% on delivery and the balance after three
months.
(b) Advance tax of 8,000 each is payable in March and June.
(c) Period of credit allowed : (i) by suppliers : 2 months ; (ii) to customers : 1 month.
(d) Lag in payment of manufacturing expenses : 1/2 month.,
ke Lag in payment of all other expenses : 1 month.
You are required to prepare a cash budget for the three months starting 1st May, 2018, when there was
a cash balance of 8,000.​

Answer 1

Answer:

60,000 34,000 8,000 3,000 1,500 4,500

You are given the following further information :

(a) Plant costing * 16,000 is due for delivery in July, payable 10% on delivery and the balance after three

months.

(b) Advance tax of 8,000 each is payable in March and June.

(c) Period of credit allowed : (i) by suppliers : 2 months ; (ii) to customers : 1 month.

(d) Lag in payment of manufacturing expenses : 1/2 month.,

ke Lag in payment of all other expenses : 1 month.

You are required to prepare a cash budget for the three months starting 1st May, 2018, when there was

a cash balance of 8,000

Answer 2

Explanation:

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