Compile a cash budget with the following budget:

Sales forecasts:

January R4 000 000

February R5 000 000

March R3 000 000

April R2 000 000

May R3 500 000

June R4 500 000

Credit sales are as follows:

.30% of sales are done in cash and the remainder on credit

.10% during the month of sale

.40% during the first month after the month of sale

The remainder is collected during the second month after the month of sale

Purchases amount to 60% of the sales value per month. All purchases are on credit and are paid as follows:

.30% one month after the purchase took place

.The remainder , the second month after the purchase took place…

Budget reflected R200 000 000 expenditure for the month of June. Balance brought down to R5 000 000 for March. A recommended minimum cash balance of R4 000 000 was maintained.