giver JulyRM1,500,000 Aug RM1,600,000 Sept RM1,700,000 Oct RM1,800,000 RM1,900,000 RM1,800,000 Nov Dec 70% of sales are collected in the month of the sale, 25% are collected in the month following the sale, and 5% are written off as uncollectible. Cost of goods sold is 40% of sales. Purchases are made the month prior to the sales and are paid during the month the purchases are made (for example, goods sold in July are bought and paid for in June). Total other cash expenses are RM120,000/month. The company's cash balance as of Oct 1 2020 will be RM600,000. Excess cash will be used to retire short-term borrowing (if any) Lemon Yellow Berhad has no short-term borrowing as of 30 September 2020. Assume that the interest rate on short-term borrowing is 1% per month. The company mus have a minimum cash balance of RM100,000 at the beginning of each month. Round al answers to the nearest RM100. Required. Based on the information given, prepare the cash budget for the fourth quarter of 2020 for Lemon Yellow Berhad.

giver JulyRM1,500,000 Aug RM1,600,000 Sept RM1,700,000 Oct RM1,800,000 RM1,900,000 RM1,800,000 Nov Dec 70% of sales are collected in the month of the sale, 25% are collected in the month following the sale, and 5% are written off as uncollectible. Cost of goods sold is 40% of sales. Purchases are made the month prior to the sales and are paid during the month the purchases are made (for example, goods sold in July are bought and paid for in June). Total other cash expenses are RM120,000/month. The company's cash balance as of Oct 1 2020 will be RM600,000. Excess cash will be used to retire short-term borrowing (if any) Lemon Yellow Berhad has no short-term borrowing as of 30 September 2020. Assume that the interest rate on short-term borrowing is 1% per month. The company mus have a minimum cash balance of RM100,000 at the beginning of each month. Round al answers to the nearest RM100. Required. Based on the information given, prepare the cash budget for the fourth quarter of 2020 for Lemon Yellow Berhad.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter15: Managing Short-term Assets

Section: Chapter Questions

Problem 2PROB

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