Manele a financial consultant has been self-employed for


Problem

Manele, a financial consultant, has been self-employed for two years. His list of clients has grown and he is earning a reputation as a shrewd investor. Manele rents a small office, uses the pool secretarial services, and has purchased a vehicle that he is depreciating over three years.

The following income statements cover Charles's first two years of business:

                                                 Year 1            Year 2

Commission revenue                    25000            65000

Rent                                           12000            12000

Secretarial services                       3000              9000

Car expenses, gas, insurance        6000              6500

Depreciation                                15000            15000

Net income                                  11000            22500

Manele believes that he should earn more than R11 500 for working very hard for two years. He is thinking about going to work for an investment company where he can earn R40 000 per year. What would you advise Manele to do?

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