Prepare cash budget for the months of october and november

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Reference no: EM13878917

CZD Ltd supply records, tapes and CDs to retail outlets. You are presented with the following financial information and are required to complete the cash budget for the three months ending 31 December 2005.

Opening cash 1/10/05 is £16,000. Creditors give one month's credit.

Salaries are paid in the same month as they are earned.

Other expenses are paid one month in arrears and include £2000 depreciation each month. Credit sales are settled 30% in the month of the sale and the remainder one month following the sale.

Month

Cash sales £

Credit sales £

Purchases £

Salaries £

Expenses £

September

25,000

40,000

70,000

6,000

7,000

October

28,000

45,000

68,000

6,000

7,000

November

28,000

40,000

59,000

6,000

7,000

December

30,000

38,000

60,000

6,000

7,000

(a) Prepare a cash budget for the months of October, November and December 2005.

(b) Prepare a schedule of outstanding debtors at the end of each of the months of October, November and December 2005.

Reference no: EM13878917

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