Question

Please make a cash budget for the months of January, February and March 1999 based on the data for


HASF PVT.LTD
BUDGETED INCOME STATEMENT
FOR 1st QUARTER 1999
Description JANUARY FEBRUARY MARCH
Sales 285,000 323,000 221,000
Purchases 129,000 168,000 95,000
Wages 35,000 37,000 30,000
Supplies 26,000 23,000 21,500
Utilities 6,500 8,700 7,200
Rent 15,000 12,800 13,600
Insurance 12,000 12,000 12,000
Advertising 24,500 28,500 18,000
Depreciation 20,000 20,000 20,000
Net Profit 17,000 13,000 3,700
Required:
a. Please make a cash budget for the months of January, February and March 1999 based on
the data for: (5 Marks)
View Receivable Trend:
• 30% of Sales are collected in the month of sale
• 30% of Sales are collected after the month of sale
• 40% of Sales are collected two months after the sale is made
View Payable Trend:
• 10% of Purchases are paid for in the month of purchase
• 35% of Purchases are paid after the month of purchase
• 55% of Purchases are paid two months after the purchase is made
Additional Information:
• Rent and Insurance expense were prepaid at the end of 1998

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Answer #1

Cash Budget January February March (12,900 19,050 Particulars Opening balance Reciepts: Cash Sales 85,500 96,900 66,300 Colle

*Sales and purchase collected in same month considered as Cash sales and Cash purchase.

*Rent and insurance expense prepaid in 1998 considered as all three month payment is prepaid in 1998.

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