Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

with explanation. Question 3 The following information is budgeted for Aracker Son Bhd (ASB) for second quarter next year: April May June Sales RM110,000 RM130,000

with explanation.

image text in transcribed
Question 3 The following information is budgeted for Aracker Son Bhd (ASB) for second quarter next year: April May June Sales RM110,000 RM130,000 RM180,000 Purchase of materials RM85,000 RM92,000 RM105,000 Administration expenses RM50,000 RM40,000 RM35,000 Fixed overhead RM60,000 RM60,000 RM60,000 Direct labour cost RM55,000 RM37000 RM45,000 Variable overhead RM25,000 RM15,000 RM15,000 Proceeds-sales of securities RM250,000 RM150,000 RM300,000 All sales at ASB are on credit. ASB expects that 40% are collected in the month of sales, 60% in the month following the sale. ASB purchase all material on credit. 80% of purchases are paid for in the month of purchase, the remaining 20% are paid for in the following month. The purchase of material for the month of March is RM90,000. Fixed overhead include depreciation of RM10,000. Direct labor cost, variable overhead and administration expenses are paid within the month they are incurred. Opening cash balance in April is RM50,000. The company wishes to maintain a minimum cash balance of RM100,000 at the end of each month. The company borrows money from the bank at 12% interest if necessary to maintain the minimum cash balance. Assume that borrowed money in this case is for two months. Required: Prepare a cash budget for the months of April, May and June

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting Plus

Authors: Robert Libby, Patricia Libby, Daniel Short

8th Edition

1259116832, 9781259116834

More Books

Students also viewed these Accounting questions

Question

What factors determine a winner-takes-all market?

Answered: 1 week ago

Question

Demonstrate knowledge of the company/organization and the position.

Answered: 1 week ago

Question

Get married, do not wait for me

Answered: 1 week ago

Question

Do not pay him, wait until I come

Answered: 1 week ago

Question

Do not get married, wait until I come, etc.

Answered: 1 week ago