UK Cash Budget


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Hello Everyone
Please help me in making a cash budget from the following information. I am a new student and would be thankful for your help.

Question:
Mr. David Gladstone setting up a small business providing cleaning services to offices on a trading estate in Scarborough. She has asked you to help her prepare a cash flow forecast for her first 12 months of trading. You should produce a forecast from January to December based on the information provided below. Sales and purchases for the 12 months are expected to be as follows.

Month
Sales
Purchases
January£5,000£600
February£5,000£600
March£5,000£600
April£5,000£600
May£5,000£600
June £5,000£600
July £4,000£500
August£4,000£500
September£5,000£600
October £6,000£650
November£6,000£650
December£6,000£650

At the beginning of January, David Gladstone will buy two small cars, to drive herself and staff to the offices, each costing £10,000. He will invest £15,000 of his own money and has agreed a bank loan of £7000. David Gladstone will receive the loan in January and start repayments the following month at a fixed rate of £250 per month.

When meeting with bank manager, He also agreed a business overdraft that will be charged at a rate of 1 per cent on any negative closing balances. In order to start trading in January, He buys £4000 worth of cleaning equipment, including vacuum cleaners and floor buffers. In addition, He spends £150 on less durable (not as long-lasting) products such as dusters and mops, which He plans to replace every second month. David Gladstone plans to offer 30 days’ credit terms to two of his bigger cleaning contracts. These two combined will account for £2200 of his monthly sales.

David Gladstone has rented a small lock-up to store his equipment and materials at a cost of £600 per month. He will employ four cleaners, each earning £400 per month, and a cleaning supervisor earning an annual salary of £7200. He will withdraw £1000 a month for herself, and hopes to be able to increase this to £1200 per month after six months.

Additional monthly costs include: • £300 car insurance • £20 advertising • £100 fuel.

Thanks again for your help...
 
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Ian

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Please note that if you are looking for assistance with an exam-style question, you must attempt the question yourself before asking for help. You can then state the answer you have so far and explain which aspect you need help with. Anyone posting exam-style questions expecting the answer to be given to them will have their posts removed. Repeat offenders will be banned from the forum.
 
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Learned Members Please Check and Comment.

Thanks in Advance :)
 
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Cash Budget David Gladstone
JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecember
Receipts
Sales
5,000​
5,000​
5,000​
5,000​
5,000​
5,000​
4,000​
4,000​
5,000​
6,000​
6,000​
6,000​
Less: 2200
-2,200​
-2,200​
-2,200​
-2,200​
-2,200​
-2,200​
-2,200​
-2,200​
-2,200​
-2,200​
-2,200​
-2,200​
Add: Previous
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
Sales Proceeds
2,800​
5,000​
5,000​
5,000​
5,000​
5,000​
4,000​
4,000​
5,000​
6,000​
6,000​
6,000​
Loan Amount
7,000​
Cash Invested
15,000​
Total Receipts
24,800​
5,000​
5,000​
5,000​
5,000​
5,000​
4,000​
4,000​
5,000​
6,000​
6,000​
6,000​
Payments
Purchases
600​
600​
600​
600​
600​
600​
500​
500​
600​
650​
650​
650​
Cars Payment
20,000​
0​
0​
0​
0​
0​
0​
0​
0​
0​
0​
0​
Loan Repayment
0​
250​
250​
250​
250​
250​
250​
250​
250​
250​
250​
250​
Cleaning Tools
4,000​
0​
0​
0​
0​
0​
0​
0​
0​
0​
0​
0​
Mops etc
150​
0​
150​
0​
150​
0​
150​
0​
150​
0​
150​
0​
Other Costs
420​
420​
420​
420​
420​
420​
420​
420​
420​
420​
420​
420​
Salaries
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
2,200​
Drawings
1,000​
1,000​
1,000​
1,000​
1,000​
1,000​
1,200​
1,200​
1,200​
1,200​
1,200​
1,200​
Rent
600​
600​
600​
600​
600​
600​
600​
600​
600​
600​
600​
600​
Total Payments
28,970​
5,070​
5,220​
5,070​
5,220​
5,070​
5,320​
5,170​
5,420​
5,320​
5,470​
5,320​
Net Receipts
-4,170​
-70​
-220​
-70​
-220​
-70​
-1,320​
-1,170​
-420​
680​
530​
680​
Opening Bank Bal.
0​
-4,212​
-4,325​
-4,590​
-4,707​
-4,976​
-5,096​
-6,480​
-7,727​
-8,228​
-7,623​
-7,164​
Closing Bank Bal.
-4,170​
-4,282​
-4,545​
-4,660​
-4,927​
-5,046​
-6,416​
-7,650​
-8,147​
-7,548​
-7,093​
-6,484​
Overdraft Charge
-42​
-43​
-45​
-47​
-49​
-50​
-64​
-77​
-81​
-75​
-71​
-65​
Closing Bank Bal. C/F
-4,212​
-4,325​
-4,590​
-4,707​
-4,976​
-5,096​
-6,480​
-7,727​
-8,228​
-7,623​
-7,164​
-6,549​
 

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