SALES BUDGETS AND CASH FLOW PROJECTION

Natural stuff manufactures a single product. The following forcast are for the three months
ending 31/12/2020.

Months Units Selling prices

October 4,000 $8

November 10,000 $9

December 12,000 $9

Prepare the sales budget for the period October to December, 2020.

Natural Stuff
Sales Budget for the quarter ending December 2020

October November December

Units 4,000 10,000 12,000

Selling price x$8 x$9 x$9

Total $32,000 $90,000 $108,000

Using the following cash flow projections, complete the cash flow statement.

October November December

Cash sales 32,000 90,000 108,000

Receipts from credit 12,000 15,600 20,000

customers

Purchase of non 7,000 86,000 0

current assets

Payments for credit 3,000 5,000 10,000

purchases

Utilities 3,600 4,000 4,000

Salaries 25,000 25,000 30,000

Advertising 1,000 1,000 1,000

The cash balance is expected to be $10,000 on 1st October, 2020.

Natural Stuff Cash Flow Projection for the period October to December , 2020
October November December

$ $ $

Receipts

Cash sales 32,000 90,000 108,000

Receipts from credit 12,000 15,600 20,000

customers

Total receipts 44,000 105,600 128,000

Payments

Payments for credit 3,000 5,000 10,000

purchases

Utilities 3,600 4,000 4,000

Salaries 25,000 25,000 30,000

Advertising 1,000 1,000 1,000

Purchase of non 7,000 86,000 0

current assets

Total payments 39,600 121,000 45,000

Surplus/Deficit 4,400 (15,400) 83,000

Balance b/d 10,000 14,400 (1,000)

Balance c/f 14,400 (1,000) 82,000

PRODUCTION BUDGET FOR THE PERIOD OCTOBER TO DECEMBER 2020

October November December

Sales in units 2000 3000 2500

Add closing 200 300 250

inventory

Less opening (150) (200) (300)

inventory

No. of units 2050 3100 2450

produced
Opening inventory at 1st october was 150 units
Each month the closing inventory becomes the next month opening inventory