Apollo Ltd. sells its products allowing a credit period of 15 days only. The average variable cost is 60% of sales value and current sales amount to ₹100 lakh. Data for the year is as follows: Particulars | Current | Pro
CS Executive · Financial and Strategic Management · PYQS · June 2023
Apollo Ltd. sells its products allowing a credit period of 15 days only. The average variable cost is 60% of sales value and current sales amount to ₹100 lakh. Data for the year is as follows: Particulars | Current | Proposed Credit Period (Months) | 1/2 | 1 Sales (lakh ₹) | 100 | 120 Fixed Cost (lakh ₹) | 15 | 18 Bad Debts (% sales) | 1 | 1.5% Debtors are calculated on cost price. Expected rate of return is 16%. Which one of the following is correct?
Answer & Explanation:
Correct Answer: Option (A)
Official answer key: (A).
Topics: Financial Management
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