Progress Test: Profit v Cash The next five questions are based on the following information. Li Ming, a Business Studies graduate from Hong Kong, has settled in Scotland after her degree and intends to set up a shop selling imported rugby shirts. Before rushing into this venture, she prepares the following forecasts of her expectations of her first three months of activity: July August September Rugby shirts purchased for cash 50 60 60 Rugby shirts purchased on one month credit terms 30 30 40 Purchase price £12 £12 £15 Rugby shirts sold for cash 45 55 50 Rugby shirts sold on one month credit terms 35 35 30 Selling price £25 £25 £30 Initial investment £9,000 Li invested £9,000 cash as initial capital on 1st July and will pay each month's rent of £1,000 in cash on the 1st of each month. Telephone and IT expenses of £280 each month will be paid one month in arrears. Li will also buy a van for £5,400 cash on 1st July. The van has a 4 year useful life and will then have a scrap value of £200