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INTRODUCTION

Finance is the important thing that must be consider in doing the business, the in and out of the money must be kept so that it can be tHe record for the progress of the business to avoid from the business from having trouble such as bankruptcy or losses. To make sure that the company are success in operating their business, the company must good in distribute and used the resources that they have without consume more money, how the company used the financial information to make a right decision for the sake of the company and the performance of the money and all the financial that involved in running the business. The entire thing must be concern and take into account to make sure the company is running successfully. The research have been conducted to investigate the financial information in the Mr. Albab’s company, to know that the company spending and the in and out of the money in operating his business so I have to forecast the cast flow budget to estimate whether the company will face the losses or gain profit, through the cash flow budget I can see how the journey of the business. When the company are lack in the capital to continue operating the business there are too many sources of finance that they can used to gain more capital, but there is some impact to the income statement and also the balance sheet, to know the impact that they will faced I have to make a research on the company. To make sure that Mr. Albab have good understanding on the purpose of balance sheet, income statement and also the cash flow I have to research and know the internal and external factor of financial information. From Limbungan Barat Bhd, I have to make a research about the ratio that they get and used in operating their company, the ratio that involved is the profitability ratio, liquidity ratio, business activity ratio and also debt ratio so I have to identified and get thoroughly understanding on this thing to complete the task that have been given in the assignment.

TASK 1
(A) Cash flow budget
MONTH | AUGUST| SEPTEMBER| OCTOBER| NOVEMBER|
Sales| 65000| 75000| 93000| 71000|
| | | | |
CASH RECEIPTS| | | | |
Cash sales (25%)| 16250| 18750| 23250| 17750|
Lagged one month (60%)| 32400| 39000| 45000| 55800|
Lagged two month (15%)| 6750| 8100| 9750| 11250|
| | | | |
TOTAL CASH RECEIPTS| 55400| 65850| 78000| 84800|
Purchases (60% on sales)| 45000| 55800| 42600| 33000|
|  |  |  |  |
CASH DISBURSEMENT| | | | |
Cash purchase (12%)| 5400| 6696| 5112| 3960|
Lagged one month (78%)| 30420| 35100| 43524| 33280|
Lagged two month (10%)| 3240| 3900| 4500| 5580|
Utilities| 2300| 2300| 2300| 2300|
Wages and salaries| 3200| 3200| 3200| 3200|
Advertising| 750| 750| 750| 750|
Capital purchase| 10000| | | |
Property taxes| | 5800| | |
Insurances| 130| 130| 130| 130|
Other expenses| 6500| 7500| 9300| 7100|
Interest| 20| 86| 82| 0|
| | | | |
TOTAL CASH DISBURSEMENT| 61960| 65462| 68898| 56248|
NET CASH FLOW| -6560| 388| 9102| 28552|
+ Beginning cash balance| 3000| 3000| 3000| 3930|
Ending cash balance| -3560| 3388| 12102| 32482|
- Minimum cash balance| 3000| 3000| 3000| 3000|
Required total financing| -6560| 0| 0| 0|
Excess balance| 0| 388| 9102| 29482|
Borrowing needed this month| 6560| 0| 0| 0|
Repayment loan this month| 0| 388| 8172| 0|
Total loan balance| 8560| 8172| 0| 0|
Ending cash after repayments| 3000| 3000| 3930| 32482| | | | | |

(B) The recommendations for the cash flow budget
The cash flow already calculate and we can see that in the 4 month that we calculated there is one month that the company will face the loss that is in the august but the cash flow can be implement so that there will no loss happen in that for month and the profits and the revenues can be...
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