a. Prepare the Cash Budget for Gemilang Terbilang Bhd. for the months of October, November and December 2020. (Show clearly the working of cash receipts from sales and cash payments to supplier) b. State any THREE (3) alternatives that could be done by the top management in improving results from the Net Cash Outflows to the Net Cash Inflows.

QUESTION 3 The followings are information for budgeted sales, purchases and overheads for five months that have been provided by the Senior Finance Manager of Gemilang Terbilang Bhd. All figures have been approved to be used in the Cash Budget 2020. Purchases Sales Overheads August RM 460,000 720,800 14,400 September RM 452,800 731,000 14,500 October RM 271,700 751,600 15,540 November RM 484,100 772,000 15,860 December RM 476,100 788,400 16,540 1. 2 3 4 Additional information for the year 2020 is given below: Expected cash balance at the end of September 2020 is RM22,700. 40% of the sales are in cash, whilst the other 60% are on credit terms. 70% of the credit sales are expected to be paid in one month after sales and the remaining balance will be paid in two months late. The payments to supplier will be paid in two (2) equal instalments. The first instalment will be paid one month after purchase and the balance in the two months after purchases. The company will receive dividends of RM6,000 which will be paid in the three equal instalments starting from October 2020. Overheads include RM3,000 depreciation per month. Overheads are settled in the month it is incurred. A machinery costing RM240,000 will be bought in November 2020.60% will be paid in the month of purchases whilst the remaining balance will be settled in the month after The balance of CIMB loan of RM35,400 is expected to be settled in October 2020 with 5% of rebate received as a full settlement of loan. Fixed selling and administration is RM31,900 per month which is payable in the month it is incurred. 5. 6 7 8. 9 New long-term investment will be made in October and December 2020. Expected amounts will be RM540,000 and RM420,000 respectively