Houillier Ltd

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
I'm doing PRP (old standards) via distance learning and started doing a mock devolved ass yesterday.<BR>Task 2 Price index for yr 1 is 161.2 and 168.8 for yr 2. I have to restate thr P & L acc for yr 1 using average values of the price index ie 165 (I hope) yr 1 sales is £12247318 yr 2 is £14913230 the answer is £12824734 but I have no idea how to get to this answer somebody please help.<BR><BR>Thanks <BR><BR>Jackie

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    Houillier Ltd

    <BR>You've misunderstood the question. Average price index doesn't mean take the average of both of them.<BR>It means take the amount that the RPI has increased by and apply this to the original figures to restate them. As the RPI has gone up, you need to increase your figures by the same percentage.<BR><BR>Take the difference between the two RPIs and divide by the year you are restating<BR>168.8 - 161.2 = 7.6 / 161.2 = 0.047...<BR><BR>Then multiply by the figures you are restating<BR>0.047... x 12,247,318 = 577,417<BR><BR>Add to original figure<BR>12,247,318 + 577,417 = 12,824,734
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Houillier Ltd

    Thanks for that i was barking up the wrong tree its now clear <BR><BR>Jackie

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