Aman Archery Corporation, a rapidly expanding crossbow distributor to retail outlets, is in the process of formulating plans for 2022. The marketing director, Syahrul has completed his 2022 forecast and is confident the sales estimates will meet or exceed the forecast. The following sales figures shows the forecasted sales and will provide the planning basis for another corporate department. Forecasted sales (RM) 1,800,000 Month January February 2,000,000 2,200,000 March The sales for November and December 2021 are RM1,500,000 and RM1,700,000 respectively. Adnin, the assistant controller has been given the responsibility for formulating the cash flow projection, a critical element during a period of rapid expansion. The following information will be used in preparing the cash analysis: (i) Aman Archery has experienced an excellent record in account receivable collection and expects this trend to continue. 60% of sales are collected in the month after the sales and 40% in the second month after sales. (ii) The purchase of crossbow is the largest expenditure for Aman Archery. The cost of cash purchase these items equals 50% of sales. (iii) The company will purchase and pay for a new delivery van costing RM120.000 in January 2022.
Aman Archery Corporation, a rapidly expanding crossbow distributor to retail outlets, is in the process of formulating plans for 2022. The marketing director, Syahrul has completed his 2022 forecast and is confident the sales estimates will meet or exceed the forecast. The following sales figures shows the forecasted sales and will provide the planning basis for another corporate department. Forecasted sales (RM) 1,800,000 Month January February 2,000,000 2,200,000 March The sales for November and December 2021 are RM1,500,000 and RM1,700,000 respectively. Adnin, the assistant controller has been given the responsibility for formulating the cash flow projection, a critical element during a period of rapid expansion. The following information will be used in preparing the cash analysis: (i) Aman Archery has experienced an excellent record in account receivable collection and expects this trend to continue. 60% of sales are collected in the month after the sales and 40% in the second month after sales. (ii) The purchase of crossbow is the largest expenditure for Aman Archery. The cost of cash purchase these items equals 50% of sales. (iii) The company will purchase and pay for a new delivery van costing RM120.000 in January 2022.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:(iv) Wages are 20% of the current month's sales. These wages are paid in the
month incurred.
(v) The closing cash balances for December 2021 is RM100,000 and if the
closing cash balances reached RM350,000 and above, 50% of this amount
is placed in a Fixed Deposit Account.
Required:
Prepare a cash budget for Aman Archery Corporation for the first quarter of
2022.
Transcribed Image Text:Aman Archery Corporation, a rapidly expanding crossbow distributor to retail
outlets, is in the process of formulating plans for 2022. The marketing director,
Syahrul has completed his 2022 forecast and is confident the sales estimates
will meet or exceed the forecast. The following sales figures shows the
forecasted sales and will provide the planning basis for another corporate
department.
Forecasted sales (RM)
1,800,000
2,000,000
2,200,000
Month
January
February
March
The sales for November and December 2021 are RM1,500,000 and
RM1,700,000 respectively.
Adnin, the assistant controller has been given the responsibility for formulating
the cash flow projection, a critical element during a period of rapid expansion.
The following information will be used in preparing the cash analysis:
(i) Aman Archery has experienced an excellent record in account receivable
collection and expects this trend to continue. 60% of sales are collected in
the month after the sales and 40% in the second month after sales.
(ii) The purchase of crossbow is the largest expenditure for Aman Archery.
The cost of cash purchase these items equals 50% of sales.
(iii) The company will purchase and pay for a new delivery van costing
RM120,000 in January 2022.
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