Reference no: EM132999593
Question - Orange Juice Limited has presented the following estimates relating to 2019 activities:
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Quarter ending
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31 March
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30 June
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30 September
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31 December
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Sales revenue
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600,000
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750,000
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820,000
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870,000
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Purchases
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350,000
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400,000
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400,000
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420,000
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Cost of sales
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300,000
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375,000
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410,000
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435,000
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Administrative expenses
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125,000
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125,000
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125,000
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125,000
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Occupancy expenses
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55,000
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55,000
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55,000
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55,000
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Depreciation expense
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15,750
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15,750
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15,750
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15,750
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The following information was given:
a) Sales in the December quarter 2018 were R 500 000.
b) All sales are on credit, of which 60 per cent are collected in the quarter of sale and 40 per cent in the following quarter.
c) Purchases are on credit, and entity policy is such that all purchases are paid for in the same quarter.
The administration expenses incurred and paid are the same.
d) Occupancy expenses incurred and paid are the same, except that the December quarter does not include the last month's utility's R785.
e) IT hardware acquisition of R 27 420, to be paid for in cash, is expected in the December quarter.
f) The bank balance at 31 December 2018 was R25 400.
Required -
1. Prepare a schedule of receipts from debtors showing cash collections for each quarter of 2019?
2. Prepare the cash budget for each quarter?
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