Month Total Sales January February R550 000 R500 000 March R480 000 April May June R400 000 R425 000 R600 000 Cash Sales amount to 25% of the total sales. Collections of the credit sales are as follows: 40% in the month of sale and is a subject to a 4% discount 30% one month after the month of sale 28% two months after the month of sale The remainder is uncollectable Solly Limited inventory requirements are equal to 30% of the next months sales. The purchases' terms of payment require a down payment of 45% and the balance is payable 30 days thereafter. July's total sales are expected to be R620 000. Solly Limited had a bank overdraft of R150 000 on 1 May 2016. Required Prepare a acash budget for Solly Limited for the Month of May and June 2016.Show all your calculations.

Month Total Sales January February R550 000 R500 000 March R480 000 April May June R400 000 R425 000 R600 000 Cash Sales amount to 25% of the total sales. Collections of the credit sales are as follows: 40% in the month of sale and is a subject to a 4% discount 30% one month after the month of sale 28% two months after the month of sale The remainder is uncollectable Solly Limited inventory requirements are equal to 30% of the next months sales. The purchases' terms of payment require a down payment of 45% and the balance is payable 30 days thereafter. July's total sales are expected to be R620 000. Solly Limited had a bank overdraft of R150 000 on 1 May 2016. Required Prepare a acash budget for Solly Limited for the Month of May and June 2016.Show all your calculations.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter15: Managing Short-term Assets

Section: Chapter Questions

Problem 2PROB

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