The projected sales of Terus Maju Holdings for the first and second quarter of 2009 are as

follows:

Month Total sales (RM)

January 2 500 000

February 2 600 000

March 2 650 000

April 3 630 000

May 3 850 000

June 3 780 000

July 3 900 000

i. The company makes 20% cash sale, 50% is collected in the month following sales, and 30% is collected in the second month following sales.

ii. Purchases are 60% of sales and are made one month before the sales occur. Payment is

made equally in the two months after purchases.

iii. The company pays RM35 000 each month for wages and RM20 000 each month for rent

and other administrative expenses.

iv. Selling expenses are RM40 000 per month. Tax repayment of RM30 000 are made at the beginning of each quarter.

vi. A machine costing RM70 000 will be bought on May 2009, and the monthly depreciation

is RM200.

vii. Interest on term loan of RM15 000 is payable at the beginning of every quarter.

viii. Beginning balance is RM80 000 and a minimum of RM20 000 must be maintained at all

times.

Prepare a cash budget for Terus Maju Holdings for the second quarter of 2009. (20 marks)