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"BDL Ltd. is currently preparing its cash budget for the year to 31 March 20XX. An extract from its sales budget for the same year shows th…

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"BDL Ltd. is currently preparing its cash budget for the year to 31 March 20XX. An extract from its sales budget for the same year shows the following sales values.RsMarch 60,000April 70,000May 55,000June 65,00040% of its sales are expected to be for cash. Of its credit sales, 70% are expected to pay in month after sale and take a 2% discount. 27% are expected to pay in the second month after the sale, and the remaining 3% are expected to be bad debts. The value of sales budget to be shown in the cash budget for May 20XX is"

ARs. 60,532
BRs. 61,120
CRs. 66,532
DRs. 86,620

Correct answer: A

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Discussion 1

CCommunity16 Jun 2021

Rs. 60,532

40% of May sales for cash (40% x Rs. 55,000) = Rs.22,000 70% of April credit sales less 2% discount (70% x 60% x Rs. 70,000 x 98%) = Rs. 28,812 27% of March credit sales (27% x 60% x Rs. 60,000) = Rs. 9,720 Total Sales = Rs. 22000 + Rs. 28812 + Rs. 9720 = Rs. 60,532.