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Question: STP Ltd. has to arrange for overdraft facilities with its bankers during the period April June of a particular year, when it will be manufacturing water coolers. Prepare a cash budget for the above period from the following data, indicating the extent of ban facilities the company will required at the end of each month.
•50% of the credit sales are realized in the month following the sales, and the remaining sales in the second month following.
•Creditors are paid in the following month of the purchase.
•Cash in the bank on 1st April is Rs. 25,000.
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