Andy attends a financial seminar to set up his new laundry business in Shah Alam which is going to start in the next two months. He made a list of items that need to be considered and to be settled. Shop Setup (Installer) Machine Supplier Rental RM3000 x 6 months deposit • Medium Washer RM2000 x 4 unit Layout RM3000 • Large Washer RM2700 x 4 unit Signage RM1500 • Medium Dryer RM2200 x 4 unit Token Vending Machine RM1000 Safety CCTV RM1000 Monthly Expenses (Operation) Wifi RM300 • Laundry Soap RM700 Water and electricity lines RM2000 • Operator RM1000 Permit & Documentation RM2500 • Utilities Bill RM1200 Maintenance RM300 Rental RM3000 a. The installer gives trade discount of 20% and 10%, and same goes to the supplier. Determine the capital starting cost to run the business. (5 marks)
b. He plans to get his capital back within 7 years. Determine the monthly payment for total installer and supplier cost with the rate of 1% compounding monthly. (5 marks)
c. Calculate the total monthly expenses including operation and capital cost instalment. (5 marks)
d. Assume, the rates are RM6 per hour for washer, RM5 per 30 minutes for dryer, running daily for 12 hours each at 50% machine quantity. Estimate his business profit for 20 days. (15 marks)
e. If he can reduce the shop rental and utilities bill by 30%, determine the new profit he can gain based on answer in d. (8 marks)
f. If he plans to reduce the rate price but maintain his profit in answer e. after 7 years, determine the maximum discount percentage​