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Adventure Travel Ltd (AT) information about the company and forecasts for next year is as follows:

1. Travel agents deduct a 10% commission from the full price of each holiday before remitting the other 90% to the company at the time of booking.
2. Winter sports holidays have a cost to the customer of 700 each and beach holidays cost 600 each.
3. Flights and hotel accommodation are booked by AT as soon as the booking is received from a customer. Airline charges for both types of holiday are 200 per passenger. Hotel charges are 250 for beach holidays and 300 for winter sports holidays. Both airline and hotel charges must be paid in the month in which the holiday was originally due to be taken. It is not ATs practice to make any refunds to its clients, irrespective of the date of cancellation.
4. At 31 December 2019 the company has received 1,320 bookings for winter sports holidays. It is estimated that bookings and cancellations for next year will be as follows:

5. Salaries at AT will be 41,200 for each month of the ensuing year. These will be paid during the month in which they are incurred.
6. Electricity is expected to be the same as this year at about 3,000 each quarter, payable on 1 January, 1 April, and so on. (Electricity is billed in arrears in other words electricity for January, February, March is paid for on 1 April.)
7. The business rate is also expected to be the same as this year at 4,000 in total, payable in two equal instalments on 1 April and 1 October. (Rates are billed in advance).
8. Repairs are expected to cost about 200 each month, payable in the month concerned.
9. Depreciation is to be charged at the rate of 20% on the net book value of the equipment and furniture. No depreciation is to be charged on the building.
10. Staff will incur costs for travelling on behalf of the company. These are expected to be at the rate of 7,000 each month during the months when holidays are being taken by clients. During each of the other three months, the figure will be 1,000.
11. The company has always adopted the policy of realising the profit on a particular holiday (i.e. recording the sale and the related expense in the income statement) in the month in which it is taken.

Requirements:

1. Prepare:
   1. A projected month-by-month cash flow statement for the year ended 31 December 2020.
   2. A projected income statement for the year ending 31 December 2020.

Holidays taken / Winter Beach Holidays cancelled | Winter Beach 80 100 - 1,080 1,040 1,580 460 140 40 Holidays booked Winter Beach 1,320 1,400 300 1,480 1,960 240 1,720 80 1,320 900 200 160 160 140 100 220 720 - 800 6,400 6,820 13,220 40 60 Pre-Jan Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Total Combined total 400 740 1,780 2,140 1,200 160 180 120 4,160 360 6,260 10,420 560 920 Winter holidays booked between September and December are not expected to be taken until the following year. AT's outline Statement of Financial Position as at 31 December this year is expected to look as follows: Statement of Financial Position for Adventure Travel Ltd as at 31 December 2019 ASSETS Non-current assets Land & buildings 420,000 Equipment & furniture 114,000 534,000 Current assets Prepaid rates 1,000 Cash 42,400 43,400 Total assets 577,400 EQUITY & LIABILITIES Equity Share capital Retained earnings 20,000 138,600 158,600 Current liabilities Trade payables Accrued electricity 415,800 3,000 418,800 577,400 Total equity & liabilities Holidays taken / Winter Beach Holidays cancelled | Winter Beach 80 100 - 1,080 1,040 1,580 460 140 40 Holidays booked Winter Beach 1,320 1,400 300 1,480 1,960 240 1,720 80 1,320 900 200 160 160 140 100 220 720 - 800 6,400 6,820 13,220 40 60 Pre-Jan Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Total Combined total 400 740 1,780 2,140 1,200 160 180 120 4,160 360 6,260 10,420 560 920 Winter holidays booked between September and December are not expected to be taken until the following year. AT's outline Statement of Financial Position as at 31 December this year is expected to look as follows: Statement of Financial Position for Adventure Travel Ltd as at 31 December 2019 ASSETS Non-current assets Land & buildings 420,000 Equipment & furniture 114,000 534,000 Current assets Prepaid rates 1,000 Cash 42,400 43,400 Total assets 577,400 EQUITY & LIABILITIES Equity Share capital Retained earnings 20,000 138,600 158,600 Current liabilities Trade payables Accrued electricity 415,800 3,000 418,800 577,400 Total equity & liabilities

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