Prepare a cash budget for ABC Co. for April-August 2022, given the following sales collection pattern: 40% in M+1, 40% in M+2, and 20% in M+3. Assume Feb sales were 100,000 and March sales were 120,00

Question One

Cash Budget for ABC Co. for the period April 2022 to August 2022

Step 1: Calculate Cash Receipts from Sales
The collection pattern for sales is:

• 40% in the month following the sale (M+1)
• 40% in the second month following the sale (M+2)
• 20% in the third month following the sale (M+3)

Month of Sale	Sales (Sh.)	M+1 (40%)	M+2 (40%)	M+3 (20%)
Feb 202