b) Selected information concerning sales, purchases and inventories for Semboelan Trading for the first quarter...
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Accounting
b) Selected information concerning sales, purchases and inventories for Semboelan Trading for the first quarter of 2023 are summarized as follows: 1. The sale for January is estimated for 10,000 units. The sales for the following months are expected to increase by 20% from the previous month. The selling price is RM15.00 per unit. 2. The sales for November and December were 6,000 and 8,000 units respectively. 3. Only 60% of the total sales are made in cash in the month of sale, while 20% are collected in the month after the sales, and the balance 20% is collected in the second month after the sales. 4. The company requires the ending inventory to be kept at minimum equals to 40% of the cost of goods sold of the following month. The cost of goods sold averages 55% of the sales. Required: i) Prepare a sales budget for the months of January, February and March. (2 marks) ii) Prepare a schedule of expected cash collections for the months of January, February and March. (3.5 marks) iii) Prepare a merchandise purchases budget showing the units that should be purchased for the months of January, February and March. (5.5 marks)
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