CASE STUDY – II
Prepare the cash budget for April-October from the following information supplied by Shah Agencies Ltd.

The other expenses per month are : Rent 1000/-,Depreciation 1000/-,Miscellaneaous expenses 500/- and commission 1 percent of sales. Out of the total sales , 80 percent is on credit and 20 percent of cash ; 70 percent of credit sales are collected in the first month following sale and the balance in second month. There are no bad debt losses. Gross margin on sales on an average is 30 percent . Purchases equal to the next month sale are made every month & they are paid during the month in which they are made . The firm maintains a minimum cash balance of Rs 10000/-. Cash deficiencies are made up by the bank loans whish are repaid at the earliest opportunity available and cash in excess of Rs 15000/- in securities (ignore interest on bank loan & securities). Outstanding liabilities remain unchanged. Debtors pertain to credit sales of March .