BDL Ltd is currently preparing its cash budget for the year...

Home / Commerce / Costing / Question

Examveda

"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.
Rs
March 60,000
April 70,000
May 55,000
June 65,000
40% 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"

A. Rs. 60,532

B. Rs. 61,120

C. Rs. 66,532

D. Rs. 86,620

Answer: Option A

Solution (By Examveda Team)

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.

This Question Belongs to Commerce >> Costing

Join The Discussion

Comments (1)

Anita Saini:

6 years ago

Total cash received in the month of May
March sales 60000*60%*27%=9720
April sales 70000*60%*70*-2%discount =28812
May sales 55000*40%=22000

Total cash 9720+28812+22000=60532 Ans.

BDL Ltd is currently preparing its cash budget for the year...

Solution (By Examveda Team)

Join The Discussion

Comments (1)

Read More: MCQ Type Questions and Answers