Andrew as the financial controller ofPT.YAKIN wasasked to make a cash budget with the dataas.following:

.

a.Cash balance per June 1 is IDR 10,000,000

b.Sales in rupiah (Rp):

	April	May	June
cash sales	30,000,000	45,000,000	60,000,000
Credit sales	75,000,000	75,000,000	90,000,000
Total sales	105,000,000	120,000,000	150,000,000

c.Credit sales will be received within 3 months, with the following conditions:

- 70% will be received in the 1st month (on sale), 15% in the 2nd month, and 10% inthe 3rd month.

- Credit sales that will be received in the 3rd month will be subject to a late penaltyof 1.5%of thesales.

- However, only half paid the late fees and business owners felt it was not important to collect the rest because thecosts weregreaterthan the revenues.

- Remaining sales are uncollected sales.

d.Inventory purchases are an average of 70% of total sales per month.Of these purchases, 60% ispaid in the month of purchase.The remaining 40% is paidin the next not.

e.Salary is paid every month in the amount of IDR 20,000,000, including IDR 8,000,000 forbusinessowners.

f.Office rental expense is Rp. 3,500,000 per month.

g.The tax expense for June is IDR 3,000,000

Assumption: Thecompany does not need a minimum cash balance and business owners do nothave access to borrow money in the short term.

REQUESTED:

1.How is depreciation expense treated when making a Cash Budget?

2. Make a cash budgetfor the month of June.

3. What are your recommendations regarding the cash budget that you have made with the above assumptions?