Budgeting Exam Questions - Doubt

siva

I had my budgeting exam on saturday i had a question in the section 1 matching the source of information,
I had Material supplies and i matched this with internet search engine as i did not have any other options matching to this. Is this correct.:mad2:

Also another question in section 2 i had the sales for next year £302400 which was assumed with 4% decrease in sales price and 5% increase in something, but now it should be just 6% decrease in sales price.

my answer was £282000 is this correct.- can anyone plase tell me.

Also There was another question where i need to prepare the operating statement but the sales price was £12 but now the price should be reduced by 5% what will be the sales price - i was so confused about this. Should that be calculated as 12-(12*5/100)=11.4 or 12/1.05 = 11.43

SandyHood

Siva
In response to question one

i did not have any other options matching to this. Is this correct.

You already know you are right.
Question two

Also another question in section 2 i had the sales for next year £302400 which was assumed with 4% decrease in sales price and 5% increase in something, but now it should be just 6% decrease in sales price.

my answer was £282000 is this correct.- can anyone plase tell me.

I will have to interpret this as being:
£302,400 assumed 4% decrease in sales price and 5% increase in sales volume, but now no increase in sales volume is expected and instead the price will be decreased by 6%.

So if you adjust the £302,400 to the value it would be without the price decrease and volume increase you have a value of £300,000
Then reduce it by 6% to give the figure you wrote: £282,000
Another correct answer well done.

the sales price was £12 but now the price should be reduced by 5%

£12 less 5% = £11.40
5% of £12 is £0.60

On the basis that these were your only problems, I would think you have probably passed.

siva

Hi Sandy,

Thank you very much for your reply. I feel better, but still i got the last one wrong as i used £11.43 as the sales price.

I am confused as to why shouldn't i use this method.

I am still worried because i dont know if i will get enough marks in written questions.

Thank you again.

Siva

SandyHood

Siva

I think you are cleverer than your posts suggest.

It all depends on what you want to find 5% of.
If you had a price which had been increased by 5%, and you had to find that original price then your current price is 105% of the original price. In this situation you use the technique you described and produce the answer £11.43

If your employer wanted to advertise that goods were now being sold without VAT I know the actual price will include VAT but this is a common advert
Will you knock 20% off the current VAT inclusive price?

Or will you say that you need to take off 20/120ths from the price?

I hope this example helps

siva

Oh god, i was totally in tension, i forgot about this completely.

thanks.