Module 8 • The fi nancial plan


Information 1. The opening balance is R2500. 2. Chippies’s monthly fixed expenses are R1500 in total. Add all the fixed expenses together and enter the answer in all the fixed expenses blocks for the months ahead (A). (Advertising was listed separate to assist with the calculation of the advertising budget.)


3. Chippies is buying ¯(33%) of their stock on credit. The cash part (R1000) is entered in the month when it is bought and the credit (R500) part 30 days later. (B) (The total purchases for the first month totalled R1500.)


4. Part of Chippies’s sales is also on credit. The credit part is only shown once it is received from the debtors (next month) (C).


5. Any other payments R3000 (D) or money received are shown when the cash transaction takes place.


Questions


Complete the table below using all the above information about Chippies. Note the distinction between “cash” and “credit”.


March


Cash sales Credit sales Total sales


Cash purchases Credit purchases Total purchases


Additional • Note the relationship between “total sales” and “total purchases” for each month. • This business opened on the first of March. This is the reason why there are no “credit payments” for March. If the business had already been in operation then February’s sales would have been given in order to know what the credit receipts for March were.


Activity 5 Blondie


Months


March April May June


Estimated income Estimated purchases


R8 000 R3 000 R5 000 R6 500


R3 000 R5 000 R2 000 R4 000


Additional information: 1. Blondie bought a new tumble-drier in March. She paid R700 deposit and her monthly payments thereafter will be R250 for the next six months.


2. Her average expenses per month are: • Rental • Wages


R1 200 R1 000


April May June July


159


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