Assignment 1 XYZ Sdn Bhd is estimating its cash requirement for the third quarter of year 2011

Subject:FinancePrice:2.86 Bought15

Share With

Assignment 1 XYZ Sdn Bhd is estimating its cash requirement for the third quarter of year 2011. The company's projected sales are as follows: Months March April May June July August September October Sales (RM) 170,000 160,000 140,000 180,000 200,000 220,000 195,000 180,000 1) Cash sales are 10% of the current month's sales, while 90% of them were sold on credit. 60% of the month's credit sales are paid in the month following the sale, while 30% of it are paid in the second month following the sale. Another 10% is bad debt. ii) Purchases are 50% of sales and were made one month before sales. iii) Payments on accounts are on 30% of current month's purchases plus 70% of the previous month's purchases. iv) Wages and salaries amounting to 10% of the preceeding month's sales. v) An 8% semi-annually interest payment on RM100,000 notes payable is to be paid in July 2011. vi) The company plans to pay RM6,500 in cash for a brand new computer in August. vii) A quarterly dividend of RM10,000 will be paid to ABC Corporation in March, June, September and December viii) The firm's ending balance for June 30, 2011 is RM56,000 and the minimum balance the firm wishes to have for every month is RM25,000. Prepare a cash budget for XYZ Sdn Bhd for the third quarter of year 2011.