Practice Assessment 2 on Budgeting - query about Task 4

Jayney

Hi can someone show me how to work out sales revenue for year 5?

Sales Rev for yr 1 is 12,200, yr 2 12747, yr 3 13527, yr 4 14091 & year 5 ?
Sales price index for yr 1 110.0, yr 2 114,0, yr 3 120.0, yr 4 124.0 & yr 5 130.0
Sales revenue at yr 1 prices. yr 1 12200, yr 2 12300, yr 3 12400 & yr 4 12500

Thank you in advance

SandyHood

Janey
I copied out your numbers and spotted a trend on the third row.
You may have seen it too. At yr1 prices the sales revenue is rising by 100 per year.
On that basis, I would predict that the year 5 sales revenue at yr 1 prices will be £12,600.
I can also see that any sales revenue at yr 1 prices value divided by the yr1 sales price index and x the sales price index for that year = the sales revenue for that year.
For example year 3: £12,400/110 x 120 = £13,527
So applying the same approach to year 5
£12,600/110 x 130 = £14,891

Year	Year 1	Year 2	Year 3	Year 4	Year 5
Sales Revenue	12,200	12,747	13,527	14,091	to find
Sales Price Index	110.0	114.0	120.0	124.0	130.0
Sales Revenue at yr 1 prices	12,200	12,300	12,400	12500	not given

hanifnoor

I would predict that the year 5 sales revenue at yr 1 prices will be £12,600.
I can also see that any sales revenue at yr 1 prices value divided by the yr1 sales price index and x the sales price index for that year = the sales revenue for that year.