The figures in the table below relate to HM Furnishing which is seeking your advice

on its financial position.

20232024$20232024$

Expected Results Budgets

November

($($RM)$)$

December

($($RM)$)$

January

($($RM)$)$

February

($($RM)$)$

March

($($RM)$)$

April

($($RM)$)$

Sales 60,00070,00072,00066,00060,00068,000$60,00070,00072,00066,00060,00068,000$

Materials 30,00035,00036,00033,00030,00034,000$30,00035,00036,00033,00030,00034,000$

Wages 12,00014,00014,40013,20012,00013,600$12,00014,00014,40013,20012,00013,600$

Expenses 12,60014,70015,20013,80012,70014,300$12,60014,70015,20013,80012,70014,300$

TOTAL

COSTS

54,60063,70065,60060,00054,70061,900$54,60063,70065,60060,00054,70061,900$

NET

PROFITS

5,4006,3006,4006,0005,3006,100$5,4006,3006,4006,0005,3006,100$

...5/−$..\mathrm{.}5/-$

You are provided with the following additional information:

$$ Each month consists of four weeks.

5$5$ BBM205/03$205/03$

20%$20\%$ of sales are for cash, and 80%$80\%$ on credit. Half the credit customers pay

in the month following the month of the sale and the balance two months later.

$$ All purchases for materials are on credit and are paid for in the month

following the month of the purchase after first deducting a 5%$5\%$ cash discount.

$$ Wages are paid one week in arrears.

$$ Expenses which include RM2,500$2,500$ for depreciation each month are otherwise

paid in the following month.

$$ In January 2024,$2024,$ the company will purchase a new delivery van for RM42,000$42,000$

less RM6,000$6,000$ trade in on the old van. Payment will be made 50%$50\%$ in the

month of purchase and the balance of 50%$50\%$ in March.

$$ The bank balance at start of January 2024$2024$ is expected to be RM 2,800.$2,800.$

$$ No stock of raw materials or finished goods is held.

Required:

Prepare the 4$4$ months Cash Budget from January to April 2024.$2024.$

Answer rating: 100% (QA)

Cash Budget for HM Furnishing January to April 2024 January 2024 Cash Receipts Sales 20 cash 72000 20 14400 Collections from December credit sales 50 ... View the full answer