Developing Profit and Return on Investment Through hard work and careful saving,

Question

Developing Profit and Return on Investment Through hard work and careful saving, Hans and his family have152,000 to start a small business. The family estimates sales tocustomers will be about $4,500 per month during the first year. Onthe average, expected cost per month are budgeted as follows: Wages for occasional labor $700 Rent on land and buildings $1,200 Supplies $75 Utilities   $100 Advertising  $300 Delivery costs $225 What is the projected monthly profit? What is the expected annual on investment? Developing Profit and Return on Investment Through hard work and careful saving, Hans and his family have152,000 to start a small business. The family estimates sales tocustomers will be about $4,500 per month during the first year. Onthe average, expected cost per month are budgeted as follows: Wages for occasional labor $700 Rent on land and buildings $1,200 Supplies $75 Utilities   $100 Advertising  $300 Delivery costs $225 What is the projected monthly profit? What is the expected annual on investment?

Explanation / Answer

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Amount

Sales permonth 4,500.00 Costs per month: Wages foroccasional labor 700.00 Rent on Land& buildings 1,200.00 Supplies 75.00 Utilities 100.00 Advertising 300.00 DeliveryCosts 225.00 2,600.00 Expected MonthlyProfit 1,900.00 Expected AnnualProfit 1900 *12 22,800.00 Annual Return on Investment 0.15 Annual Return onInvestment 15%

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