The forecasted sales for Becs and Cooper limited for January to April 2014 appear in the table below;
| Month |
January |
February |
March |
April |
| Sales |
150 000 |
170 000 |
95 000 |
200 000 |
The company receives 45% of all sales in the month of sale, 30% is received one month later and the remaining percentage is received two months following the month of sale.
Purchases are valued at 50% of each months projected sales
The following cash receipts and cash disbursements should also be taken into account:
Rental income for Jan and Feb amounted to 5000 each, while 10% increase for March and April are forecasted
In Feb the company made a cash contribution of 15 000 to a local charity
Telephone expenses vary each month. The telephone costs for Jan, Feb and Mar were 1000, 1300 and 900 respectively
Salaries are paid as commission, which is calculated at 15% of each months sales value
The retrenchment of two employees in March cost the company 33 000
The ending cash balance on 31 Dec 2013 is 10 000.
Prepare a cash budget for the months of Jan, Feb and March.