Good Products Ltd prepares monthly cash budgets. Below is a summary of information taken from the firm's financial records.

The following estimates relate to April:

$

Credit sales

320,000

Credit purchases

210,000

Wages expense

88 000

Administration expenses

36,000

Cost of sales

180,000

Depreciation expense

12,000

Cash payment for new machinery

20,000

Cash proceeds from the sale of old machinery

7,500

Rent expense

1,200

All sales are on credit.Collections from debtors (accounts receivable) normally have the following pattern:60 per cent in the month of sale, 30 per cent in the month following the sale, and 10 per cent in the second month following the sale.

Sales in January, February and March were $295,000, $266,000 and $302,000 respectively.

Credit purchases are paid for in the month following the purchase. Credit purchases in March were $182,000 and in February were $194,000.

The company plans to repay a $30,000 loan in May.

The cash balance at 1^stApril was $4,000.

Wages and Administration expenses are paid in the month in which the expense arises. Rent was paid in advance in March.

Required:

1. a Budgeted Income Statement for the month of April.

Budgeted Income Statement

For the month of April

2. a schedule of estimated receipts from debtors (accounts receivable)

for the month of April.

Month of cash collection

Month

Credit Sales

April

3.What is the amount of accounts receivable at 30^thApril?

4. a cash budget for April.

APRIL

ESTIMATED CASH RECEIPTS

TOTAL ESTIMATED CASH RECEIPTS

ESTIMATED CASH PAYMENTS

TOTAL ESTIMATED CASH PAYMENTS

NET INCREASE/(DECREASE) IN CASH

BEGINNING CASH BALANCE

ENDING CASH BALANCE

5.suggest Good Products Ltd on how the company may be able to end with a positive cash balance at the end of April.