Financial Guide for SMEs - SME Corporation Malaysia

Financial Guide for SMEsFinancial Guide for SMEsNote: For cashflow forecasting,all estimatesshould includesales andservices taxOctoberYear OneMonthly Cash ReceiptsYear TwoNovember December January February March April May JuneJuly August September October November DecemberTotal Monthly SalesRM 4,056RM 4,300 RM 4,800 RM 5,500 RM 5,500 RM 6,050 RM 6,600 RM 6,930 RM 7,150 RM 7,700 RM 7,920 RM 8,030 RM 8,250 RM 8,470 RM 7,700Total Cash Sales40%Not RequiredRM 2,200 RM 2,200 RM 2,420 RM 2,640 RM 2,772 RM 2,860 RM 3,080 RM 3,168 RM 3,212 RM 3,300 RM 3,388 RM 3,080Total Credit Sales60%RM 2,434 RM 2,580 RM 2,880 RM 3,300 RM 3,300 RM 3,630 RM 3,960 RM 4,158 RM 4,290 RM 4,620 RM 4,752 RM 4,818 RM 4,950 RM 5,082 RM 4,620The next step is for Adam to complete a table that calculates the cash collections from his credit sales. From the sales madeon credit, Adam has worked out the average collection rate and has made a note in the following table:% of sales receipts collected in month following the sale% of sales receipts collected in 2nd month following the sale% of sales receipts collected in 3rd month following the sale60 %30 %10 %So, applying the above percentages to his estimated sales for year two, Adam has been able to calculate the estimated”actual” cash receipts from sales.7373Chapter 6 p66-78 Eng.indd 738/15/11 5:02:25 PM