Required:The business needs to have a sense of its future cash inflows and outflows for the quarter and therefore requires the preparation of the following:A schedule of budgeted cash collections for trade receivables for each of the months January to March.A schedule of expected cash disbursements for accounts payable for each of the months January to March.A cash budget, with a total column, for the quarter ending March 31, 2023, showing the expected cash receipts and payments for each month and the ending cash balance for each of the three months, given that no financing activities took place. of $1,600,000 and was funded by a loan from a family member, who is a silent partner in thebusiness. $320,000 of the principal along with interest of $35,000 will become due and payable onJanuary 25, 2023.(xi) Wages and salaries are expected to be $3,384,000 per annum and will be paid monthly.(xii) The cash balance on March 31, 2023, is expected to be an overdraft of $248,000Required:(a) The business needs to have a sense of its future cash inflows and outflows for the quarterand therefore requires the preparation of the following:a.A schedule of budgeted cash collections for trade receivables for each of themonths January to March.b.A schedule of expected cash disbursements for accounts payable for each of themonths January to March.c.A cash budget, with a total column, for the quarter ending March 31, 2023,showing the expected cash receipts and payments for each month and the endingcash balance for each of the three months, given that no financing activities tookplace.(b) Another team member who is preparing the Budgeted Balance Sheet for the business forthe same quarter ending March 31, 2023 and has asked you to furnish him with the figuresfor the expected trade receivables and payables to be included in the statement. Is that areasonable request? If yes, what should these amounts be?(c) Upon receipt of the budget, the team manager, Damion Brownie, has now informed youthat, in keeping with industry players, the management of Varsity Supplies & Things haveindicated an industry requirement to maintain a minimum cash balance of $162,000 eachmonth. He has also noted that management is very keen on keeping the gearing ratio of thebusiness as low as possible and would therefore prefer to cushion any gaps internally usingequity financing. Based on the budget prepared, will the business be achieving this desiredtarget? Suggest three (3) internal strategies that may be employed by management toimprove the organization's monthly cash flow and militate against or reduce any possibleshortfall reflected in the budget prepared. Each strategy must be fully explained Varsity Supplies & Things is a family-owned store. The business is now approaching the end of theyear and is desirous of identifying its expected cash inflows and outflows for the first quarter of thenew year. You are the management accountant of the entity and have been tasked to prepare thecash budget for the business for the quarter ending March 31, 2023. The following data is available:(i) Extracts from the sales and purchases budgets are as follows:Month2022 2023November 2022December 2022January 2023February 2023March 2023CashSales$142,100$165,500$171.475$144.940$236.720SalesOnAccount$480,000$600,000$650.000$700.000$800.000CashPurchases$25,800$44,625$30,400$55,100PurchasesOnAccount$345,000$380,000$400,000$480,000$540,000(ii) An analysis of the records shows that trade receivables (accounts receivable) are settledaccording to the following credit pattern, in accordance with the credit terms 4/30, n90: 55% in themonth of sale 35% in the first month following the sale 8% in the second month following the saleThe remaining 2% is expected to be uncollectible(iii) Accounts payable are settled as follows, in accordance with the credit terms 2/30, n60: 85% inthe month in which the inventory is purchased 15% in the following month(iv) The management of Varsity Supplies & Things has negotiated with a tenant to sublet office spaceto her beginning February 1. The rental is expected to be $576,000 per annum. The first month'srent along with one month's safety deposit is expected to be collected on February 1. Thereafter,monthly rental income becomes due at the beginning of each month.(v) Office Furniture & Fixtures, which is estimated to cost $350,000, will be purchased in February.The manager has made arrangement with the suppliers to make a cash deposit of 40% upon signingof the agreement in February. The balance will be settled in five (5) equal monthly instalmentsbeginning March of 2023.(vi) The management of Varsity Supplies & Things is in the process of upgrading its fleet of motorvehicles. During February the business expects to sell an old delivery motor van that cost $720,000at a loss of $45,000 to an employee. Accumulated depreciation on this motor van at that time isexpected to be $375,000. The employee will be allowed to pay a deposit equal to 50% of the sellingprice in February; the balance will be settled in two equal amounts in March & April of 2023.(vii) Fixed operating expenses which accrue evenly throughout the year, are estimated to be$2,088,000 per annum, which include depreciation on non-current assets of $504,000 per annumand are expected to be settled monthly.(viii) Other operating expenses which accrue evenly throughout the year are expected to be$672,000 per annum and will be settled monthly.(ix) A long-term bond purchased by Varsity Supplies & Things two (2) years ago, with a face value of$450,000 will mature on January 15, 2023. To meet the financial obligations of the business,management has decided to liquidate the investment upon maturity. On that date semi-annualinterest computed at a rate of 8% % per annum is also expected to be collected(x) As part of its investing activities, the management of Varsity Supplies & Things has just concludedan expansion project relating to the business's storage facilities. The project required capital outlay15

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A cash budget is an estimate of a corporation's cash flows for a given time span. A cash budget is…