He has some goods and some profits – how should he work out his zakaah?

Praise
be to Allah.

What is required in the case of zakaah for trade is: to work out the value
of the goods that have been prepared for sale every time one year has
passed, and that is done on the basis of the price for which they are sold
– not the price for which they were bought. If the dealer sells goods
wholesale, then the value should be worked out based on the wholesale
price; if he sells them retail, then the value should be worked out based
on the retail price. 

If the trader has profits in hand (i.e., cash in hand at the end of the
year), that profit should be added to the value of the goods, as well as
outstanding debts owed by people that he still hopes to get back. Then from
this total he should pay one quarter of one tenth (2.5 %) 

He should not pay any attention to the capital with which he bought the
goods. 

Based on that, if you work out the value of the goods that you still have at
the end of the year, based on the price for which you sell them, and it
amounts to 370,536; then you take out one quarter of one tenth from that,
you have to give 9263.4 

With regard to the profits that you mentioned, if this money is still with
you at the end of the year, then you should also pay one quarter of one
tenth of it. But if you have spent it during the year, or spent some of it,
then no zakaah is due on it, apart from whatever is left of it at the end of
the year. 

So the zakaah of a dealer or trader is worked out according to the following
formula: 

Zakaah = (2.5% of cash in hand at the end of the year + the value of the
goods that you still have at the end of the year + outstanding debts that
are owed to you by people that you still hope to get back). 

Debts owed by the trader are not to be deducted, according to the more
correct scholarly opinion. 

See also the answer to questions no. 50726,
26236 and 120371 

And Allah knows best.