Module: General Practice
Q33: Scenario: "Apex Traders" is assessed using the Nayak Committee Turnover Method. Their projected annual turnover is ₹400 Lakh.
Question: What is the specific amount of Promoter's Contribution (Margin) required to be brought in by the borrower according to the standard formula?
✅ Correct Answer: C
The rule for the Turnover Method is that the Total Working Capital Requirement is 25% of Turnover.
This is split into Bank Finance (20% of Turnover) and Promoter's Margin (5% of Turnover). Here, the Turnover is ₹400 Lakh.
The Margin required is 400 multiplied by 0.05, which equals ₹20 Lakh. (The Bank Loan would be 400 multiplied by 0.20, which is ₹80 Lakh).
This is split into Bank Finance (20% of Turnover) and Promoter's Margin (5% of Turnover). Here, the Turnover is ₹400 Lakh.
The Margin required is 400 multiplied by 0.05, which equals ₹20 Lakh. (The Bank Loan would be 400 multiplied by 0.20, which is ₹80 Lakh).