FP trends

Sammys1987

Hi,

Just wondered if someone can help, can't work this out.

Sv = +10% +20% -15% -10%

Act cost= 13200 15000 11050 12150

Underlying
Trend. = ? ? ? ?


And is the below correct?

If underlying cost for previous month is £420?

Underlying cost = 440 460 480

Sv. = 30 (10) 30

Forecast sales. = 410? 470? 450?

I can't find it in my books much info on it but its on a practice paper I have.

Please could someone help?

Thanks in advance

amyjayne27

Hi Sammy,

With the first part of the question, I know that to get the underlying trend you take the actual cost and if the seasonal variation is a positive you deduct that figure from the actual cost and vice versa if its negative. However by doing this with the below figures I get :

Actual cost 13200 15000 11050 12150
SV +10% +20% -15% -10%
Trend 11880 12000 12708 13365

Which gives an inconsistent trend: 120,708,657.

Are the figures definately right?

Sorry if I have done this wrong but it doesnt seem to work.

Thanks

Sammys1987

Hi Amy,

That's exactly the figures I hav got!! Il have to look into it. I thought I was doing it wrong!!

Thanks

amyjayne27

Well I may be wrong too, but thats the answer I got. Maybe the figures in the question are wrong?

Feel free to send me the question if you can via pm and I can take a look at it.

Thanks

Nps

OK, your actual values are 13200, 15000, 11050 and 12150, and you know that these are 110%, 120%, 85% and 90% of the underlying (non seasonal variated- is that a word?) figures.

So if 13200 is 110%, 100% must be 12000
15000 is 120% so 100% is 12500
If you do the final 2 values you will see that each time, the underlying value goes up by 500, so there is your trend.

Nps

I don't really know what you mean with the 2nd bit, but from what I can tell from what you've written, your underlying trend is going up by 20 each month and for the 3 months in question (440, 460 and 480), you need to add +30, -10 and +30 to them to get the actual figures, so 470, 450 and 510.

Sammys1987

Thanks nps that is helpful. I did originally put the last figures on my practice assessment and then I thought that was wrong :-/.

amyjayne27

Thats good to know Nicola thanks, I always thought in these types of questions the trend should be consistent month after month.

Glad you have got your answer Sammy!

welshwizard

Actual SV Trend
Month 1 13200 10% 12000
Month 2 15000 20% 12500
Month 3 11050 -15% 13000
Month 4 12150 -10% 13500

Sammys1987

Thank you!!

Does anyone know how to do the other question? I can't remember if u do the opposite ie if its positive you subtract it, if its negative you add it??

Thanks

Nps

It should be covered in my 2nd post, if I've understood the question right.

welshwizard

As NPS said:

Underlying cost = trend I believe so:

Underlying cost = 440 460 480

Sv. = 30 (10) 30

Actual should be: 470 450 510