Annual sale of Vineet Company is 32,000 units @ 25 per unit. Its variable cost is 15 per unit and fixed cost 1,60,000 per year.The average collection period is 30 days. Bad debts are expressed at 3%. 

Let's calculate the key financial figures based on the information provided for Vineet Company:

### Given Data:
- **Annual Sales Volume**: 32,000 units
- **Selling Price per Unit**: ₹25
- **Variable Cost per Unit**: ₹15
- **Fixed Costs**: ₹160,000 per year
- **Average Collection Period**: 30 days
- **Bad Debts**: 3% of total sales

### 1. **Total Revenue:**
   \[
   \text{Total Revenue} = \text{Sales Volume} \times \text{Selling Price per Unit}
   \]
   \[
   = 32,000 \times 25 = ₹800,000
   \]

### 2. **Total Variable Cost:**
   \[
   \text{Total Variable Cost} = \text{Sales Volume} \times \text{Variable Cost per Unit}
   \]
   \[
   = 32,000 \times 15 = ₹480,000
   \]

### 3. **Contribution Margin:**
   \[
   \text{Contribution Margin per Unit} = \text{Selling Price per Unit} - \text{Variable Cost per Unit}
   \]
   \[
   = 25 - 15 = ₹10 \, \text{per unit}
   \]
   \[
   \text{Total Contribution Margin} = \text{Contribution Margin per Unit} \times \text{Sales Volume}
   \]
   \[
   = 10 \times 32,000 = ₹320,000
   \]

### 4. **Net Profit Before Bad Debts:**
   \[
   \text{Net Profit Before Bad Debts} = \text{Total Contribution Margin} - \text{Fixed Costs}
   \]
   \[
   = 320,000 - 160,000 = ₹160,000
   \]

### 5. **Bad Debts:**
   \[
   \text{Bad Debts} = \text{Total Revenue} \times \text{Bad Debt Percentage}
   \]
   \[
   = 800,000 \times 0.03 = ₹24,000
   \]

### 6. **Net Profit After Bad Debts:**
   \[
   \text{Net Profit After Bad Debts} = \text{Net Profit Before Bad Debts} - \text{Bad Debts}
   \]
   \[
   = 160,000 - 24,000 = ₹136,000
   \]

### 7. **Average Accounts Receivable:**
   The average accounts receivable can be calculated using the average collection period.
   \[
   \text{Average Accounts Receivable} = \frac{\text{Total Revenue} \times \text{Average Collection Period}}{365}
   \]
   \[
   = \frac{800,000 \times 30}{365} \approx ₹65,753.42
   \]

### Summary of Key Financials:
- **Total Revenue**: ₹800,000
- **Total Contribution Margin**: ₹320,000
- **Net Profit Before Bad Debts**: ₹160,000
- **Bad Debts**: ₹24,000
- **Net Profit After Bad Debts**: ₹136,000
- **Average Accounts Receivable**: ₹65,753.42

This analysis gives you a clear understanding of the company's profitability and the impact of bad debts on its net profit.

Would you like further details or have any questions?

Here are some related questions:
1. How can Vineet Company improve its accounts receivable turnover ratio?
2. What strategies can be used to minimize bad debts?
3. How does the average collection period affect a company's cash flow?
4. What is the impact of extending credit terms on sales and profitability?
5. How can Vineet Company optimize its fixed and variable costs to improve net profit?

**Tip:** Regularly monitor your accounts receivable and collection periods to maintain a healthy cash flow and minimize bad debts.

Explore a detailed financial analysis of Vineet Company's operations, including sales volume, variable costs, fixed costs, bad debts, and net profitability. Understand the impact of these factors on the company's financial performance.

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