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QUESTION 4 (20 MARKS) Hijau Bhd provided the following information for the month of January and February 2022: a. On 1 January, the cash balance
QUESTION 4 (20 MARKS) Hijau Bhd provided the following information for the month of January and February 2022: a. On 1 January, the cash balance amounted to RM20,100. Accounts receivable balance on the same date totalling to RM150,000, of which RM130,000 will be collected during January and RM19,000 will be collected during February. The remainder will be uncollectible. b. Past experience shows that 50% of a month's sales are collected in the month of sale, 45% in the month following sale, and 5% in the second month following sale. Budgeted sales and expenses for the month of January and February 20223 is as follows: c. Purchases of inventory are paid in full during the month following purchase. Accounts payable for inventory purchases during December 2021, which will be paid in January 2022 for RM165,000. d. Minimum monthly cash balance is required to be at RM30,000 e. In preparing the cash budget, assume that the any loan will be made in January and repaid in February with an interest at 0.005%. Required: Compute the expected cash collections and prepare the cash budget for the month of for the month of January and February 2022. (20 marks) (CLO3:PLO12:C4)
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