Programme Bachelor of Commerce in Accounting

Module Managerial Accounting

Module Code MAC320 / MAC420
NQF Level 7
Credits 15
Assessment Type Individual Assignment 2
Semester 2ND Semester
Due Date TBA

Total marks 50
Pass mark 50%
Weighting 10%
Examiner Phyllis Chikwati
Moderator Makomborero Bure

This question paper consists of 2 pages including the cover page.

INSTRUCTIONS:
Read the following instructions CAREFULLY:
1. Assignments must be presented in the correct format. Your assignment should be typed –
Arial font 12; 1.5 spacing; Justified (ctrl + J))
2. Ensure that your details and the name of your campus are clearly indicated on the cover page
of your assignment.
3. Please note that it is your responsibility to retain copies of your assessments.
4. Use the Harvard method of Referencing for citing your sources.
5. Use current research sources, preferably not older than five years.
6. A CheckforPlagiarism report MUST be attached to each assignment submission.
7. It is in your own interest to present your work neatly.

1|P age
Cash Budget Question
Alberta Ltd’s estimated revenues for the first four months of 2010 is as
follows:
January February March April
R108,500 R106,200 R120,500 R120,500

All sales are on credit. Customers are expected to pay one-quarter of their debts a month
after the sale and the remainder after two months: sales expected for November 2009 are
R95,500, and for December 2009, R105,300. Material purchases for the same period are:

January February March April

R21,500 R21,200 R24,400 R24,100

• One fifth of the materials are paid for in the month of purchase and the remainder
two months later: deliveries received in November 2009 wereR18,800, and in
December 2009, R19,600.
• Old factory equipment is to be sold in February 2010 for R2,800. Receipt of the
money is expected in April 2010. New equipment will be installed at a cost of
R20,000. One quarter of the amount is payable in February2010 and the remainder
2 months later. Wage costs during this period are as follows:

January February March April

R4,300 R4,200 R4,800 R4,900

• Three-quarters of the wages are payable in the months they fall due, the
remainder a month later: wages for December 2009 are estimated atR4,200.
Overhead costs are as follows:
January February March April
R72,300 R70,800 R80,200 R80,400

• R12,000 of total monthly overheads are payable in the month they occur, and the
remainder one month later: total overheads for December2009 are expected to be
R69,400.
• The opening bank balance at 1 February 2010 is expected to be an overdraft of
R11,000.

REQUIRED:
2|P age
(a) Construct a monthly cash budget for Alberta Ltd for the 3 months from 1st
Feb to 30th April 2010, showing the cash balance at the end of each month. (A total
column is not necessary (35 marks)

(b) Advise the company about possible ways in which it can improve its cash
management both in the long-term and the short-term (15 marks)

Question 2

Presentation 4 marks

3|P age