Calculate the ROI of the distributor given below: XYZ Marketing is in the distribution business of Nextel eleco!

"#$ %s&'Matrix eleco! "(#)$X&' Nokia Mobile #hones * +har, fax !achines- he .istributor has de,lo/ed funds fro! his own sourcesPrincipal Nextel eleco! Matrix eleco! Nokia Mobile #hones +har, 8ax Revenues 0-1 Cr5-6 Cr0-6 Cr5-9 CrMargin 23 073 73 13 CD 43 43 Nil Nil

(x,enses:Month (lectricit/;Rs- 45'555 ele,hones;Rs-07'555 )d!in- * +u,,ort +taff;Rs-76'555 Rent;Rs-01'555 Conve/ance;Rs-6555 otal < =4'555 Calculate the ROI for Nextel Telecom for the Month of April 2004. O,ening +tock;09 >akhs Receivables;01 >akhs Credit Notes ,ending fro! the Co-; 7 >akhs +tock in ransit; 6 >akhs +econdar/ sales; 06 >akh Outstanding with N >;Nil +che!es;0-13 )$"?uarterl/@)nnuall/&;5-213 A) ;07-13
RETURN ON INVESTMENTS

NEXTEL TELECOM
Investments: O,ening +tock "+tarting of the !onth : Aalue& )dd : #urchase fro! N > "Aalue& Receivables fro! the Market "Aalue& Credit Notes due fro! N > "Aalue& >ess : +econdar/ +ales for the !onth "Aalue& O:s with N > ),ril 755B 7B'55'555 09'67'7B7-=5 01'55'555 7'55'555 06'55'555 55 Ma/ 755B M nt!s Cune 755B Cul/ 755B

Net Investment Inc me : +ales Margin for the Month "On +econdar/ +ales Aalue& )dd: Cash .iscount fro! N > "Aalue& )$ "?uarterl/ @ )nnuall/& +che!es "Aalue& >ess: )d!inistrative (x,enses Interest Charges "Aalue& Indirect (x,enses "Related to $usiness& Net Inc me " rmula # r ROI $ Net Inc me Net Investments

4='67'7B7-=5

002212-05 B1'066-76 00'7=2 B106-64 B9'B1=-15 7='965 057970-20

N te: T!e investments an% e&penses s! ul% 'e strictl( restricte% t t!e 'usiness # t!e %istri'ut r )it! NTL

otal Revenues < 0-1 Cr- @ 5-6 Cr- @ 0-6 Cr- @ 5-9 Cr- < B-2 Cr#ro,ortionate (x,enses of N > "0-1 Cr- : B-2 Cr-& D =4'555 < 7='965 O,ening +tock at the beginning of the !onth O,ening stock @ +tock in transit < 09'55'555 @ 6'55'555 < 7B'55'555 $asic #urchase Aalue "x & < 0'655'555: 055@ "Margin "23& @ A) "07-1& & x < 06'55'555 D055 00=-1 & $ *+,-.,/0. Net Inco!e !argin < 06'55'555 E 09'67'7B7-=5 < 0'02'212-05 )dd C. F 43 < "43 D 01'59'729& < B1'066-76 )dd )$ F 5-213 D 01'59'729 < 00'7=2-52 )dd +che!e F " 753 of 0-13 01'59'729& < B106-64 Gh/ onl/ 753 sche!e is retainedH +ubtract Interest F 0B3"Gh/ 0B3& < ""0B:07& D 4='67'7B7-=5& : 055 < B9B1=-15 ROI < Net inco!e < 057970-20 D 055

Net invest!ent 4='67'7B7-=5 < 7-12 3 ,er !onth ROI < 7-12 D 07 < 45-=7 3 ,er /ear Ghat is the channel decision /ou should take for the above ROIH