5.3 Revenue, Costs, Profit & Loss
SP Dry Cleaners
Stuart and Pippa own a dry cleaning and launderette business called SP Dry Cleaners (SP). The pie charts below show the monthly variable costs for SP in 2017 and 2018.
Stuart and Pippa are looking to expand into clothing repair and have investigated two sewing repair businesses, HD Sewing and Fast Stitch, for sale. Pippa has stated she wants to see her investment in the sewing repair business returned within five years. Stuart has collected the following information on the two businesses.
Table 1 Financial data for HD Sewing and Fast Stitch
HD Sewing | Fast Stitch | |
Purchase price of the business | £80 000 | £65 000 |
Sales revenue per year | £90 000 | £82 500 |
Net profit per year | £25 000 | £22 000 |
Average rate of return | ? | 13.8% |
(i) Analyse one reason why SP should buy HD Sewing. Refer to data from Table 1 in your answer.
[3]
(ii) Analyse one reason why SP should buy Fast Stitch. Refer to data from Table 1 in your answer.
[3]
(iii) Recommend whether SP should buy HD Sewing or Fast Stitch to expand their business. Refer to data from Table 1 to support your judgment.
[3]
Ai এর মাধ্যমে
১০ লক্ষ+ প্রশ্ন ডাটাবেজ
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