Question

ILLUSTRATION 13. Mr. Krishan wishes to commence a new trading business and gives the
following information:
(1) The total estimated sales in a year will be 12,00,000.
(2) His expenses are estimated as fixed expenses of 5 2,000 per month plus variable expenses
equal to five per cent of his turnover.
(3) He expects to fix a sales price for each product which will be 25 per cent in excess of his cost
of purchase.
(4) He expects to turnover his stock four times in a year.
(5) The sales and purchases will be evenly spread throughout the year. All sales will be for
cash but he expects one month's credit for purchases.
Calculate :
(a) His estimated profit for the year.
(b) His average working capital requirements.​

Answer 1

Answer:

calculate al Number to the months