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Projected monthly profit;expected annual return

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The Smith family has saved for many years, and they have decided to start a hardware business with $250,000. They estimate that sales about $6000 per month during the first year. On average, the budgeted monthly costs will will be:

Wages for labor: $900
Rent on store building: $1500
Utilities: $300
Advertising: $500
Delivery costs: $400

a. What is the projected monthly profit?
b. What is the expected annual return on investment?

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Solution Summary

This post shows how to calculate the project monthly profit and the expected annual return on investment.

Solution Preview

a) Sales Revenue = $6000

Wages for labor = $900
Rent on store building = $1500
Utilities = ...

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