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(Solved): The projected sales of Palong Great Holding for the first and second quarter of 2019 are as follows ...
The projected sales of Palong Great Holding for the first and second quarter of 2019 are as follows: i) The company makes 20 percent cash sale, 50 percent is collected in the month following sales, and 30 percent is collected in the second month following sales. ii) Purchases are 60 percent of sales and are made one month before the sales occur. Payment is made equally in the two months after the 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. v) Tax repayment of RM30,000 are made at the beginning of each quarter. vi) A machine costing RM70,000 will be bought on May 2019, and the monthly depreciation is RM200. vii) Interest on term loan of RM15,000 is payable at the beginning of every quarter. vii) Beginning balance is RM80,000 and a minimum of RM20,000 must be maintained at all times. Prepare a cash budget for Palong Great Holding for the second quarter of 2019.