Son Darby SdnBhd is a company that selling office stationaries located in Kuala Langat Selangor Malaysia. They prepare monthly cash budgets. Relevant data from operating budgets for 2021 are:

January February

MYR MYR

Sales 350,000 400,000

Direct Material purchases 110,000 120,000

Direct labour 85,000 115,000

Manufacturing overhead 60,000 75,000

Selling and administration expenses 75,000 80,000

All sales are on account. Collections are expected to be 60% in the month of sale, 25% in the first month following the sale, and 15% in the second month following the sale. Thirty percent (30%) of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the purchase. All other items above are paid in the month incurred. Depreciation has been excluded from manufacturing over- head and selling and administrative expenses.

Other data:

Nov 2020 Dec 2020

1. Credit sales (MYR) 200,000 290,000
2. Purchases of direct materials. 90,000
3. Other receipts:

Januarycollection of December 31, 2020,

interest receivable MYR 3,000;

Februaryproceeds from sale of securities MYR 5,000.

4. Other disbursements: Februarypayment of MYR 20,000 for land.

The companys cash balance on January 1, 2020, is expected to be MYR 50,000. The company wants to maintain a minimum cash balance of MYR 40,000.

Required

1. Prepare the following schedules:

1. expected collections from customers
2. expected payments for direct materials purchases.

2. Prepare a cash budget for January and February in columnar form.