ACCA Applied Knowledge · Management Accounting · Summarising and analysing data
A cost index rose from 200 to 230 between two years. What was the percentage increase in cost over that period?
The cost increased by 15 per cent. The index moved by 30 points from a starting value of 200, and the percentage change is the point change divided by the earlier index value, 30 divided by 200.
- A30%
- B13%
- C15%Correct
- D23%
Explanation
Percentage change = (230 − 200)/200 = 15%. Stating 30% confuses the point change with a percentage. Using 230 as the base gives 30/230 = 13%, which is the wrong base.
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