Mr. Raju just appointed as an account manager at NH Sdn Bhd, a retail company selling merchandises for local market. Mr. Raju is being responsible to prepare and monitor the budget and expenses of the company business. Currently the company is preparing the quarterly budget as of 31 December 2020 and he has been asked by Ms. Sally, the owner of the company, to prepare a master budget. The sales forecast for the merchandises are provided as follows:

Unit sales
August 2020	1,500 actual
September 2020	1,600 actual
October 2020	1,700 budgeted
November 2020	2,300 budgeted
December 2020	2,400 budgeted
January 2021	1,300 budgeted

The average selling price and the average purchase price per unit are RM250 and RM120 respectively. As for desired ending inventory is expected 30% of next month’s unit sales. Collections from customers will be 20% in month of sale, 50% in month after sale and 30% two months after sale.

As for projected cash payments, inventory purchases will be paid in the month following acquisition. Meanwhile, variable cash expenses are equal to 35% of each month’s sales and paid in the month of sale. Fixed cash expenses are RM20,000 per month and are paid in the month incurred. Depreciation on equipment is RM2,000 per month. Desired ending cash balance per month will be RM20,000.

NH Sdn Bhd also has provided the following information at 30 September 2020

Balance Sheet as at 30 September 2020

RM
Cash	30,000
Account Receivable	245,000
Merchandise inventory(650 unit)	78,000
Fixed Assets (net)	110,000
Total assets	463,800
Account Payable(Merchandise)	148,800
Owner’s Equity	315,000
Total liability and equity	463,800

Required:

Based on the information given, you are required to prepare the following budget** for the upcoming quarter ending 31 December 2020.

1. Sales Budget for each month of the quarter;
2. Purchases Budget for each month of the quarter;
3. Cash Budget for each month of the quarter;
4. Budgeted Income Statement; Quarter
5. Budgeted Balance Sheet.

Answer rating: 100% (QA)

a NH Sdn Bhd Sales Budget October November December Total Note Units sold 170000 230000 240000 640000 A Sell price 25000 25000 25000 B Sales Budget 42500000 57500000 60000000 160000000 CAB b Material ... View the full answer