Question 3 King Ltd has a division in Juno Island and the Finance manager has approached...
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Question 3 King Ltd has a division in Juno Island and the Finance manager has approached to you assist them in developing a cash budget for a period of three months from September to November 2023. The company's activities are planned as follows: 1. Planned sales for August, September, October, and November 2023 are $380,000, $400,000, $440,000 and $460,000. 2. 40% of sales are on a cash basis while the remaining sales are on credit and 60% is collected one month after sale. 3. The company's purchases are 65% of sales. Purchases are made one month prior to sales, with payments made in the month following the purchase. 4. The bank balance on 31 August 2023 is expected to be $80,000. 5. Fixed salaries cost the company $6,800 per month. 6. $90,000 worth of Office Equipment is expected to be bought and paid for at the end of November 2023. NOTE: Copy the cash budget format into your answer booklet. King Ltd Cash budget from September to November 2023: Cash receipts: Total sales (for reference only) Cash sales ( Collection from credit customers: % in the month following sales Total Receipts Cash Payments: Purchases - % of Total sales) % of total sales Fixed salaries Purchase of Office Equipment Total Payments Surplus/(Deficit) for the month Cash balance, at start of month Cash balance, at end of month September $ October $ November $ Total Required: Prepare the monthly cash budget for the period of three months ending November 2023 for King Ltd's Juno Island. [Total: 20 marks] Question 3 King Ltd has a division in Juno Island and the Finance manager has approached to you assist them in developing a cash budget for a period of three months from September to November 2023. The company's activities are planned as follows: 1. Planned sales for August, September, October, and November 2023 are $380,000, $400,000, $440,000 and $460,000. 2. 40% of sales are on a cash basis while the remaining sales are on credit and 60% is collected one month after sale. 3. The company's purchases are 65% of sales. Purchases are made one month prior to sales, with payments made in the month following the purchase. 4. The bank balance on 31 August 2023 is expected to be $80,000. 5. Fixed salaries cost the company $6,800 per month. 6. $90,000 worth of Office Equipment is expected to be bought and paid for at the end of November 2023. NOTE: Copy the cash budget format into your answer booklet. King Ltd Cash budget from September to November 2023: Cash receipts: Total sales (for reference only) Cash sales ( Collection from credit customers: % in the month following sales Total Receipts Cash Payments: Purchases - % of Total sales) % of total sales Fixed salaries Purchase of Office Equipment Total Payments Surplus/(Deficit) for the month Cash balance, at start of month Cash balance, at end of month September $ October $ November $ Total Required: Prepare the monthly cash budget for the period of three months ending November 2023 for King Ltd's Juno Island. [Total: 20 marks]
Expert Answer:
Answer rating: 100% (QA)
King Ltd Cash budget from September to November 2023 September October November Total Cash receipts Total sales for reference only 380000 400000 44000... View the full answer
Related Book For
Accounting Business Reporting for Decision Making
ISBN: 9780730302414
4th edition
Authors: Jacqueline Birt, Keryn Chalmers, Albie Brooks, Suzanne Byrne, Judy Oliver
Posted Date:
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