Cash budget for January, February, and March 2021:
| Month | Total Sales | Materials | Wages | Overheads | Production | Selling & Dist |
|----------|-------------|-----------|-------|-----------|------------|----------------|
| January | 40,000 | 42,000 | 8,000 | 6,400 | 1,600 | |
| February | 44,000 | 28,000 | 8,800 | 6,600 | 1,800 | |
| March | 48,000 | 28,000 | 9,200 | 6,600 | 1,600 | |
Cash balance on January 1, 2021, was AED 20,000/-
A new machine is to be installed at AED 60,000/-
On credit, to be repaid by two equal installments in March & April 2021
Period of credit allowed by suppliers: 1 month
Period of credit allowed to customers: 1 month
Delay in payment of overheads: 1 month
Delay in payment of wages: 1 month
Assume cash sales to be 50% of total sales.