Budgeting query

samilou67

I can work out how to do the year one sales prices but cannot work out how to do the Year5 sales revenue forecast can anyone help please?

Yr 1 Yr2 Yr3 Yr4 Yr 5
Sales Rev 12200 12747 13527 14091 14891
Price index 110 114 120 124 130
Revenue 12200 12300 12400 12500

shamil91

Good morning,

In order to to solve the sales revenue, you must remember that it will be current year price index / (divide by) base index. In this question the base index is the first year price index of 110. In the exam it may say the base index is 201 (example). So to work out for Year 3 sales revenue, it will be 120 / 110 x (multiply) 12,400 = £13,527.27 (but do bare in mind they have rounded down as its less than .50 so it would be £13,527

Hope this helps you out and good luck

Kind regards

Shamil Karia

samilou67

Thank you

shamil91

Your most welcome