to one year] 2014 APR.[13] ABC Ltd. wishes to start a trading business and furnishes the following particulars : (a) Estimated annual sales - Rs. 3,60,000 (b) Estimated fixed expenses of Rs. 1,200 p.m. of which depreciation amounted to Rs. 400 and estimated variable expenses chargeable to Profit and Loss Account equal to 2.5% of sales. (c) Expected profit on cost -20% (d) Probable stock turnover - 2.5 times (e) The Sales and purchases will occur evenly throughout the year. (f) All purchases will be made and ABC Ltd. expects one month's credit for it. (g) One-fourth of sales will be against cash. Customers will be allowed two months credit. Calculate : (Marks 15) (i) ABC Ltd.'s estimated profit for the year and ; (ii) Average working capital requirement. Ans. [ (i) Rs. 36,600 (ii) Rs. 1,41,550 ] Hint. [ Cash assumed for one month's expenses Rs. 1,550 ]