Reference no: EM133094712

Question - AZ Ltd has the following information:

a. The cash balance on March 1, 2022 is 30,000 pound

b. Estimated sales for January, February and March 2022 are:

	Jan. 2022	Feb. 2022	Mar, 2022
Credit sales	400,000 pound	500,000 pound	600,000 pound

c. Of the credit sales, 40% are collected in the following month, 60% are collected after 2 months.

d. Inventory purchases will total 300.000 pound for February 2022 and 350,000 pound for March 2022. 80% of a month's inventory purchases are paid during the month of purchase, 20% of a month's inventory purchases are paid in the following month.

e. Selling and administrative expenses to be paid at 100,000 pound for March 2022.

f. During March 2022, a new web server for marketing of 50,000 pound will be purchased for cash, and dividends of 70,000 pound will be paid.

Required - Calculate estimated cash receipts, cash payments, ending balance for March 2022 of AZ Ltd. Is there any cash problem for March 2022? Recommend ways to overcome for AZ Ltd?